Strong Rebound in Portugal´s Hotel Investment

Portugal's hotel investment is making a remarkable comeback post the Covid-induced slowdown. In 2022, total transaction volumes soared to €1.2 billion, surpassing the previous 2019 record and doubling the figures from three years ago. The fourth quarter of 2022 marked the highest quarterly sales volume ever, nearing €900 million. Additionally, Q2 2023 witnessed a year-on-year increase of over 60%, totaling €273.7 million.

Investment in Portugal's hotel sector is now a crucial funding source. Cross-border investment reached a record €188.5 million in 2022, a figure already exceeded in the first seven months of 2023, with incoming investments totaling nearly €262 million.

The hotel industry in Portugal is expanding rapidly, with numerous development projects in the pipeline. The growth is further propelled by the appeal of remote working, given the country's co-working options, pleasant climate, affordable living costs, and excellent connectivity to major EU capitals.

Notable Hotel Transactions and Openings

Over the past two years, significant hotel transactions have occurred, primarily driven by foreign investors:

• Extendam acquired the 62-key four-star l'hôtel M.Ou.coin Porto in July 2023.
• Davidson Kempner, Highgate, and Kronos purchased 18 hotels across Portugal in January 2023, including Hilton and IHG-branded properties.
• Azora expanded its presence with the acquisition of the 500-room Pestana Blue Alvor resort in the Algarve in May 2022.
• Domes Resorts assumed management of the 192-room Lake Spa Resort in Vilamoura in November 2021.

In 2023, approximately 25 hotels have opened in Portugal, including notable properties like Pestana Rua Augusta Lisboa, Rochavau Hotel (Algarve), MASA Hotel & Spa CampoGrande Collection (Lisbon), Next Level (Lisbon), and Independente Comporta (Grândola).

Recent Chain Openings and Future Developments

Noteworthy chain openings include the 700th B&B Hotels property in Guimarães, Marriott's Renaissance Porto Lapa Hotel, Hyatt Regency Lisbon, Ivens Hotel Lisbon (Autograph Collection), and Emerald House Lisbon (Curio Collection by Hilton).

As of February 2023, there were 66 high-end hotel projects (10,000 keys) in the development pipeline, with 70% falling under the upscale segment and 30% in the luxury segment.

Upcoming Branded Projects

• Hyatt's first Andaz in Lisbon, expected in 2024.
• A third Curio Collection by Hilton, Legacy Hotel Cascais, scheduled for May 2024.
• IHG's two new locations in Lisbon, including Convent Square Hotel Lisbon and Crowne Plaza Caparica Lisbon.
• Hard Rock Hotel Algarve coming in 2026.
• Nobu Hotel and Restaurant Lisbon, marking Nobu Hospitality's expansion into Portugal.