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Hotel transaction volume halved – no recovery expected before the end of the year

Verena Bauer • 13/07/2023

In H1 2023 we recorded a transaction volume of around EUR 390 million for the German hotel real estate investment market. It is thus 50 percent below the level of a year ago and is the weakest since 2012. Only single-property transactions with an average volume of around EUR 16 million were recorded.

German investors were responsible for around two-thirds or around EUR 250 million of the transaction volume. This was followed by investors from the UK with 18 percent and from Israel with 10 percent.

Institutional investors (45 percent) and hotel operators (34 percent) were the most active segments, accounting for 79 percent of the transaction volume. For private equity investors, family offices as well as cities and municipalities, we recorded a market contribution of 21 percent.

"Above all, the rise in interest rates and the general reluctance of banks have made it considerably more difficult to finance hotel purchases. In addition, alternative asset classes such as bonds are once again a focus for institutional investors, due to their higher yields. As a result, buyers' yield expectations, especially in the core segment, have increased to at least five percent. However, the pricing phase is not yet complete, and buyers and both sellers are therefore holding back," comments Josef Filser, Head of Hospitality Germany & Austria.

The largest transactions in Q2 2023 included:

  • The purchase of the 185-room Steigenberger Hotel de Saxe in Dresden by Commerz Real's Hausinvest open-ended real estate fund. The seller, Aroundtown, acquired the property via the takeover of TLG in 2020. The hotel is let to Deutsche Hospitality on a long-term basis. On the ground floor and basement levels there is also around 1,200 sq m of retail space. 
  • The sale of the 120-room Steigenberger Grand Hotel on the Baltic island of Usedom to Union Investment's immofonds 1 open-ended real estate fund: the seller and tenant is Resort Hotel Kaiserbad GmbH & Co. KG. The newly-concluded lease agreement has a term of 20 years. The hotel will be extensively renovated in the coming years and ten rooms will be added. 
  • The sale of the Seehotels Fleesensee (156 rooms) in the middle of the Mecklenburg Seenplatte lake district to Privathotels Dr. Lohbeck GmbH: The seller was Lloyd Fonds Am Alten Kalkwerk Fleesensee GmbH. Until June of this year, the hotel operated under the Tui Blue brand.
  • The sale of the 90-unit Stayery serviced apartments in Bochum for EUR 10.5 million to Catella Wohnen Europa (CWE) fund: the seller is the developer, Kreer Development. The property is expected to be completed by mid-2024.

We expect the coming months to continue to be characterised by uncertainty due to the financial and macroeconomic environment. We do not expect any recovery in investment activity in the hotel market until the end of the year. 


verena bauer
Verena Bauer

Head of Marketing & Communications Germany, Cluster Lead • 60313 Frankfurt am Main


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