Last year saw a record number of hotel transactions worldwide — at 1,773 — but fell short of the total deal value recorded in 2021. JLL’s newly released summary of 2022 global investment activity pegs total sales at USD $71.1 billion, with eight of the top 10 markets located in the United States.

JLL analysts point to a “bifurcation of hotel acquisitions” in the surge of single-asset deals, which equated to nearly 73 per cent of 2022’s total sales value. Lower-budget properties accounted for 45 per cent of single-asset sales value, representing the highest ever proportion for that market segment. However, there were also 37 deals in which sales prices equated to at least USD $1 million per room, which was the second highest in any year yet recorded.

Hilton Millennium Seoul garnered the year’s top price, just shy of USD $930 million, equating to $1.367 million per room. Meanwhile, the Prima Hotel, also in Seoul, ranks seventh for sales price, at USD $338 million, but commanded the top per room rate at $2.817 million.

Seoul ranked third, behind New York City and Anaheim, California, in attracting investment dollars last year. The two U.S. cities record $2 billion and 1.4 billion in deals respectively. Four of the year’s five largest portfolio transactions also occurred in the U.S. with the USD $3.8 billion trade for Watermark Lodging Trust topping the list.

Geopolitical tensions and economic pressures are seen as factors in the 3.2 per cent year-over-year global decline in investment activity in 2022, but from an occupancy perspective the hotel sector continues to recover from the lows of the pandemic. France, the United Kingdom, the U.S., Italy and Australia all surpassed 2019 average revenue per available room (RevPAR) last year. Japan and China lagged the farthest behind pre-pandemic performance, respectively at 54 per cent and 62 per cent of average 2019 RevPar.

Many markets are also awaiting a return to pre-pandemic levels of international tourism. Globally, it was 37 per cent below 2019 levels last year, representing a marked improvement over 2020 and 2021 when international tourism was at 27 to 30 per cent of pre-pandemic levels. Regionally, Europe and the Middle East showed the strongest recoveries, while international tourism in Asia Pacific was still 77 per cent below 2019 levels.

“The potential impact of China’s reopening cannot be understated,” JLL analysts note. “Domestic and regional travel to broader Asia has already seen an uptick, with travel to the U.S. and Europe likely to increase soon. Widespread border re-openings could be the impetus to the re-emergence of cross-border investments which have been largely absent for the past three years.”