LONDON-A recovery in corporate travel and investor confidence marked a turning point in EMEA hotel investment in 2010 post-crisis, and volumes more than doubled to $10.7 billion from $4.2 billion in 2009, according to realtor Jones Lang LaSalle. January research by Hotstats also identifies hotel revenue growth in key cities.

In almost all markets, with the exception of Frankfurt, London and Munich, occupancy and average room rates increased last year taking room yields up an average 10% although still below the peak in 2007, JLL research showed. Market conditions remained more challenging in regional cities, which depend on domestic tourism demand. Portfolio activity totaled $3.9 billion, with single asset deals largely driven by ‘one-off opportunity’ trophy assets snapped up by Asian and Middle Eastern investors. The lack of new financing meant deal sizes remained small, with just over 70% less than $70 million and just seven above $280 million. Outside of the prime buys, investors mainly focused on assets offering long-term income.

Mark Wynne-Smith, CEO for Jones Lang LaSalle Hotels EMEA, said growth in 2011 will be driven by occupancy as travelers continue to cut costs, holding any increase in room rates outside peak periods. He commented: “2011 is not on course to see the same level of trophy assets entering the market, rather we will see a growing number of secondary assets becoming available as banks concentrate on releasing capital, with the bulk of this activity likely in the UK, Ireland and Spain.”