High interest rates continue to hold back Italy’s hotel real estate market, but it is starting to show some encouraging signs of recovery.
So, while real estate is suffering from the current macroeconomic climate with its rising interest rates, hospitality is proving to be one of the most attractive sectors for investors, thanks to record performances, especially in terms of average rates. A trend that also emerged at the 5th Hospitality Investment Conference, organized by Teamwork and Thrends.Many analysts agree that interest rates could soon fall by a few points, though levels are expected to remain high at least until the end of 2025 (Ibor rate higher than 3%). It is also thought that while international investors are still interested in Italy, the gap between the expected demand and prices is still too wide, leaving capital holders in a wait-and-see position.
Having said this, deals like Six Senses Rome, La Suvera in Tuscany and Novotel Florence show there is still interest in luxury in the main destinations. The latest developments have also influenced the volume of transactions which, according Cbre, amounted to around €0.85 billion to the third quarter of this year. But Thrends’ managing director Giorgio Ribaudo says they should already be at €1.1-1.2 billion, and that the year will possibly close at around €1.4-1.5 billion.
Massimiliano Sarti
Journalist
