NEW-BUILD HOTELS are expected to become increasingly scarce in Europe over the next two years, as developers continue to struggle to raise investment cash.
Development watchdog Lodging Econometrics (LE) calculates that 239 new hotels opened in Europe in 2009, but that will fall to 200 hotels this year, and 153 hotels in 2011.
Although the Europe, Middle East and Africa pipeline looks strong, with nearly 1,400 hotel projects on the books, LE warns that many of those are new project announcements that may not get beyond the drawing-board stage.
More than 500 were either postponed or cancelled last year.
Investors are equally unwilling to pump money into existing hotels, according to hotel analysts HVS International. The total value of European hotel transactions last year was €3 billion, an all-time low. Transactions were worth €6bn in 2008, and more than €18bn in 2007.