Asia Pacific hotel investment records $2.2B across 43 transactions in Q3

Japan and Australia are to remain the spotlights in the hotel investment scene

According to a report by Savills, hotel sales and investment sentiment across Asia Pacific continues to recover as borders gradually reopen and vaccination rollouts are well underway.  

The region’s recovery is led by North Asia with a strong flow of investment activity, while various travel schemes implemented throughout Southeast Asia markets progressively reopen borders and tourism.  

In the third quarter of 2021, USD2.2 billion of hotel investment was recorded in Asia Pacific across 43 transactions, a 12 percent increase year-on-year.  

Of the transactions, 75 percent were completed by domestic buyers. 

Japan, South Korea, and Taiwan were the top three most active markets this quarter, making up 51 percent of the total regional hotel sales volume.  

Japan led the region with three transactions that totalled a volume of USD590 million, a sharp surge compared to the reported USD168 million in the same quarter in 2020.  

Meanwhile, Taiwan recorded USD265 million across six transactions, indicating a decline of 72 percent year-on-year due to the sale of Sunworld Dynasty.  

Reporting the highest number of transactions in the region in Q3 was South Korea with 10 transactions registered at USD253 million.  

Savills Research said, “Countries across APAC are navigating their way to a ’life with COVID’ and gradually reopening their borders, while vaccination rollouts are now well underway.”  

“Regional hotel investment activity is starting to pick up as the industry prepares for a rebound in post-pandemic travel,” it added.  

As for the outlook for the region, governments are starting to introduce their initiatives to ‘live with COVID’, while prioritising vaccination rollouts to prepare for border reopening.  

Travel schemes are being launched in Southeast Asian markets like Thailand, Bali, and Singapore, in which the situation is closely monitored to ensure the safety of locals and visitors.  

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Moreover, relying on strong demand fundamentals, Japan and Australia remain in the spotlight in the hotel investment scene. This has been proven by the recent investment activity and establishment of new hotel-focused funds.  

By Q4 2021, several high-profile sales are expected to close, which will increase the yearly Asia Pacific hotel investment volume. However, the region is still far from reaching the volume levels of 2019.