Hotel transaction volumes in Scotland totalled circa £149m (transactions over £1m) across 24 key deals in 2022, according to the latest research from Savills.

The firm reports activity marks a 34% decrease on 2021 investment volumes (£226m), reflecting the wider macroeconomic conditions including rising debt costs, impacting the UK hotel market, where overall investment volumes are down 27.5% year on year (YoY).

Savills says Scottish hotel transaction volumes in 2022 reflected around 5% of overall UK volumes (£3bn). Domestic UK buyers represented approximately 72% of transaction volumes, with the remaining 28% comprising international buyers.

Key individual transactions in Scotland include: Premier Inn Glasgow, Buchanan Galleries (c. £30.2m, 210 keys); Fonab Castle, Pitlochry (Savills advised vendor) and Former Park Inn Glasgow (c. £4.5m, 91 keys, Savills sold). Key portfolio transactions incorporate the Chardon Portfolio, which saw Atlas, supported by L&R Hotels, acquire the Chardon Group, including Holiday Inn Glasgow Theatreland, Holiday Inn Express Glasgow, Holiday Inn Express Edinburgh Royal Mile, Holiday Inn Express Edinburgh Airport, Holiday Inn Express Dunfermline and Holiday Inn Express Perth.

Steven Fyfe, Hotel Capital Markets director at Savills Scotland, comments: “While the second half of the year was challenging, in terms of transactional volumes, H2 was marginally stronger than H1 in Scotland, demonstrating the ability to complete transactions in a difficult market. We are seeing stability starting to return to the market as we begin the new year with a number of sale processes underway. In terms of investment volumes, we expect a strong start to the year, with year-end volumes anticipated to reach £200m.”