Today, the Expo Real opened at the Munich fairground. The 10th International Commercial Property Exposition is taking place at the New Munich Trade Fair Centre from 8 – 10 October 2007. The first day I visited the Special Real Estate Forum and listened to at least seven (!) discussions. The Special Real Estate Forum will shed light on the diverse range of properties developed for specific uses. Experts from the market segments for hotels will introduce their projects, present their views of the market and participate in a discussion, giving participants a competent look at the latest trends and success strategies.
The Hospitality Industry Dialogue started with an overview and outlook on the market for hotel real estates. Moderated by
- – Christoph Härle, Managing Director, Jones Lang LaSalle Hotels, Munich, on the podium discussed
- – Roger Barris, Managing Director EMEA, Merrill Lynch International, London,
- – Mike Goodson, Managing Director Europe, Host Hotels Ltd., London, and
- – Leeny Kelly Oberg, Senior Vice President, Marriott Hotels International Limited, London.
Some few statements in brief:
Roger Barris: “Hotels in general are one of the most risky assets.”
Leeny Kelly Oberg: “We see an incredible shift in contracts. Management agreements became more attractive the last years. But now we perhaps see a shift back to the leases. But you’re still better in management.”
Roger Barris: “I prefer management contracts, leases are boring! But they do need to be priced appropriate.”
To the question where the hotel market will be in 2008:
Roger Barris: “The transaction volumes will be hit in this 2nd half of the year. But the main question actually is: Will the problems in the financial markets hit the real economy?”
Mike Goodson: “We have a big gap between the different price expectations. How long will it take the banks to go well. Next year I presume will be significantly lower than in 2007.”
Leeny Kelly Oberg: “We don’t know if we are really seeing a downturn in the US. There’s a lot of money looking for a new home. But people are waiting to spend it.”
Roger Barris agreed: “There’s money waiting. But banks will actually have no risk and give no debt.”