Many affluent fans of the hit comedy-drama series ‘The White Lotus’, set in opulent resorts worldwide, have been inspired to book stays in five-star hotels. However, some have taken it a step further by purchasing entire establishments.
Earlier this year, a bidding war erupted for Venice’s Hotel Bauer, with global investment firm Mohari Hospitality outbidding billionaire Bernard Arnault, among others, according to Bloomberg. Last year, entrepreneur and PR expert Matthew Freud opened the Bull Hotel in Burford, Cotswolds, and more recently, The Highway Inn in the same town.
A survey by BNY Wealth of 189 family offices revealed that property is the third-largest asset allocation class after private and public equity, with hospitality assets, including hotels, being a key area of interest. Will Turner, director of fund services at JTC Group, notes that property assets that are also operational businesses, such as hotels and resorts, have gained popularity in the current environment of higher inflation and interest rates. “Hotels generate daily revenue and can dynamically adjust prices to reflect costs,” he explains.
Turner adds that hotels offer significant value-add opportunities beyond room rates, including cross-sales in food and drink, healthcare, spa services, and shopping. The most desirable hotel investments are in cities that attract both tourists and business travellers, especially those that can capitalise on demand spikes from major events like Taylor Swift and Beyoncé’s world tours.