The hotel sector in Andalusia stands out for its dynamism in the first half of the year and the good projections for the coming months. According to CBRE data, investment in the hotel market in Andalusia totalled 161 million euros in the first half of the year, adding more than 1,300 new rooms through 13 operations.
Andalusia is positioned as the third autonomous community with the highest volume of investment in the sector in the first six months of the year, behind Catalonia and the Balearic Islands, representing 12% of total national investment in the hotel sector. In Malaga, investment in the hotel market reached 117 million euros, while in Seville investment exceeded seven million euros.
Institutional funds have been the predominant investor profile from January to June in the autonomous community, with 53% of the total investment transacted, closely followed by hotel chains, which accounted for 41% of the investment. In terms of the origin of the capital, 53% was national and the remaining percentage came from British capital.
In terms of asset type, investment in holiday hotels continued to significantly outstrip the urban segment during the first half of the year. Specifically, they accounted for 76% of investment compared to the 24% represented by urban locations in this period. By type of transaction, no portfolios were transacted in the first half of the year, with individual assets accounting for 100% of investment.
Rosa Madrid, Director of CBRE Andalucía, comments: "The hotel market in Andalucía is in the focus of investors, with a growing supply of luxury hotels and the entry of international brands. In Malaga and the Costa del Sol, investors are focusing on repositioning hotels, although these are not the only places that are generating a lot of attraction. Seville and Cadiz are also attracting a lot of interest. Overall, despite the current context, hotel investment is showing great resilience, as it is a growing sector where operations are evolving very well. Growing demand is driving up prices, which is helping to cushion the rise in operating costs".
Positive operating results of the hotel industry in Seville
The operating results of the hotel industry in Seville during the first half of the year showed higher levels than those recorded a year ago and pre-pandemic figures. RevPAR (average revenue per available room) for the first half of the year in Seville reached 44.29 euros (+20.5% vs. H1 2022), reaching 109.8 euros in April. The ADR (average price per occupied room) for the first half of the year was 108.18 euros (+12% compared to H1 2022). Overnight stays grew by 17% compared to the same period in 2022. 55% of these overnight stays during the first half of the year were of foreign origin.
The leading role of luxury hotels in Andalusia
In terms of luxury hotel supply, the segment is experiencing growth in Spain, with a special focus on Andalusia. In 2022, 5-star and 5-star UL assets accounted for 54% of annual investment (EUR 363 million), followed by 4-star hotels. This growth in the luxury and ultra-luxury segment is a result of the polarisation process that is occurring in the hotel sector. During the first half of the year in Andalusia, 4-star assets stood out, attracting 85% of the investment, which reached 132 million euros.
For Nicolás Osuna, CBRE's hotel consultant in Andalusia, "one of the trends we are seeing in the Andalusian hotel sector is the growth of the luxury hotel offer. Projects in cities such as Seville, where until now there was not so much of this type of offer, will attract tourists with high purchasing power. It is very good news that projects of this type are being developed in the city and that they are going to put Seville on the map of the luxury hotel offer".
