Pan-European Hotels 101

Green Street recently initiated coverage on Swedish company Pandox (PNDX), and also released a new Pan-European Hotels 101 report. Some highlights from the new report are included in this excerpt, as well as insight on hybrid/variable leases, taken from page 17 of the full report.

• The Pan-European Hotel market is larger than the US by room count
• Independent hotels represent the lion’s share of the total stock.
• Strong pricing performance has led RevPAR levels above pre-pandemic levels.
• Demand is mostly driven by EU travellers, China/India to boost mid-term occupancy.
• Leisure travel is going strong, business travel propensity remains subdued.
• Management contracts & franchise structures warrant higher cap rates than leases.
• Hybrid/variable leases offer better returns than fixed leases on a risk-adjusted basis.