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And find out which countries were the exceptions from the region’s positive investment market.
According to data from JLL, full year Asia Pacific hotel investment volumes in 2024 are anticipated to reach $12.2 billion, 4.3% higher than 2023’s total of $11.7 billion.
In the first nine months of 2024, JLL said cumulative transaction volumes totalled $9.05 billion, tracking up 15% year-on-year ($7.87 billion in 2023) and representing 90% of the volume of 2019. Led by Japan, cross-border investment surged in YTD Sep 2024 driven by large transactions in Asia, while Australia experienced a rare lull in annual activity.
Here’s more from JLL:
On a country-basis, investment volumes were generally positive in the first nine months of 2024, with a few exceptions across the Asia Pacific region:
Singapore: With a tourism industry firing on all cylinders, supported by mega events and high occupancy rates, Singapore’s attractiveness to investors has remained justifiably high. Deals recorded in 2024 have eclipsed the previous years totals leading JLL to project cumulative hotel investment volume for the full year to be approximately to $1 billion.
Japan: In the first nine months of 2024, Japan further established itself as the most attractive hotel market regionally. Activity through the end of September resulted in sales volumes at $3.8 billion. Given that investor interest is unlikely to wane, JLL forecasts in total sales of $4.7 billion for 2024, followed by an increase of 4% in 2025 at $4.9 billion. Despite the recent interest rate hike and slight appreciation of the yen, JLL anticipates Japan hospitality investment to remain active given the strong underlying supply and demand fundamentals.
Australia: Australian sales volumes will remain relatively subdued over 2024, JLL analysis suggest. Year-to-date volumes have totalled $629 million (settled), down 38% from the same period last year. JLL is estimating that total transaction volumes should reach approximately $1.1 billion for the full year, which is below the long-term average, but likely influenced by the fact that many 2024 transactions could also be classified as ‘last year’ deals.
Korea: Hotel transaction volumes reached approximately $1.1 billion in 2024 year-to-date with the Conrad Seoul comprising the largest transaction. JLL expects several additional hotels to transact before the end of the year, resulting in estimated transaction volume near $1.3 billion for the full year 2024.
India: Transaction volumes have multiplied from $76 million in 2022 to $337 million in 2023 and is forecast by JLL to land at $440 million this year. Capital has been supported by the sector’s robust performance in room rates, revenue, and occupancy levels. Outside of investment, development interest remains strong with hotel brands having signed agreements for approximately 19,500 new hotel rooms in the first half of 2024, accounting for 77% of the total number signed in 2023 in emerging metros.
Thailand: Investment volume dropped in 2023 due to a wide bid-ask spread and rising interest rates, however in 2024, there has been a remarkable recovery in investment activity. Year-to-date transaction volumes stand at $404 million, with a projected full-year volume of over $450 million. JLL anticipates 2025 to be on par or better with the 15-year average of $300 million in transactions, bolstered by expected lower interest rates and positive tourism sentiment from visitors around the region.
“Factors including the fluctuating currency exchange against the dollar have helped attract foreign investors since H1 2023. The welcome surge in strong tourism fundamentals in the region since the reopening of borders to international travel has also helped bolster investor appetite. Although there are some markets that may see some short-to-medium term easing of occupancy, the overall industry has entered a new phase less defined by recovery and more linked to ideas of organic and sustainable growth,” says Nihat Ercan, CEO, JLL Hotels & Hospitality Group, Asia Pacific.
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