Leisure real estate trends & opportunities.
In a zero cash-flow environment - where we keep experiencing unprecedented challenges such as the Coronavirus outbreak, oil prices turning negative and stock markets collapsing - diversification is a proven and efficient way to manage investment risks.
Despite a sharp contraction in hotel demand, hospitality-focused real estate has been attracting a record amount of international capital into the sector, becoming one of the highest performing real estate asset classes. A key driver underpinning hospitality’s outperformance is the steady growth in international tourism, which is boosting hotel occupancy rates and revenue per available room (RevPAR). Hotels are considered non-core real estate investments characterized either as value-added or opportunistic real estate from both the equity investor and lender perspectives. Given the sector’s out-performance and a positive outlook for travel and tourism industry as hotel occupancy rises, private equity groups and high-net-worth individuals will continue to be active investors of hotel assets in 2021.
Europe is the global leader in international tourism: Europe accounts for half of the world’s international arrivals, the world’s most visited region. Southern and Mediterranean Europe led results, with most destinations enjoying double-digit growth. Tourism is slowly restarting and Italy holds the record as the most desired destination in the world.
Investors are currently attracted to markets that are expected to be the first to recover. With signficant dry powder on hand, investors who previously would not have considered hospitality asset classes an acceptable investment opportunity are now leaving their comfort zone and starting to invest in hotel, serviced-apartment industry and the like.
With over 32,700 hotels and 1.1 million rooms, Italy has the biggest hotel portfolio in Europe. Currently, Italy is the only European country with more than 1 million hotel rooms, but big chains account for 5%, with the rest of the market dominated by modest, family-owned businesses.
Italy's hospitality industry is fragmented due to the absence of large hotel groups and access to this attractive asset class is not structured like for other asset classes. Hospitality is a highly complex industry and one that is difficult to navigate even by experienced investors and beyond the investment capacity, it requires on-the-ground expertise and a local track record.
With the rise of alternative assets, a growing number of investors are turning to alternative investments with a view to boosting returns, generating income, diversifying away from traditional investments and achieving their goals. Within the universe of Alternative Investments - to which real estate belongs - hospitality is a sector that has fully entered the radar of domestic and international investors. Even in the world of bricks and mortar, portfolio diversification is essential and decisive: residential remains an asset class capable of generating significant returns by benefiting from portfolio diversification strategies and structural changes in demand. The old Italian real estate stock is not able to meet the new demand for services and comfort: there will be a growing appetite for upgraded and certified green, healthy and sustainable buildings with a significant focus on quality, technological innovation and sustainability. We will realize very soon that the ongoing disruption will become a positive accelerator and an opportunity for investors and industry managers who will be able to seize it first.
Eccelsa Aviation was named Europe’s best FBO for 10 consecutive years in 2018 by Business Destinations Magazine.
Emerald Coast is the most expensive location in Europe. House prices reach up to €300,000 per square meter. Romazzino Bay is currently the highest-priced residential in Europe.
There is a multitude of outstanding accommodations that support a luxurious lifestyle. The top 10 most expensive hotel suites in the world include the Penthouse Suite at Hotel Cala di Volpe, boasting the uncompromising luxury of Emerald Coast.
Yacht Club Costa Smeralda is one of the world’s most exclusive yacht clubs founded by H.H. the Aga Khan in 1967. The Yacht Club Costa Smeralda is famous for organizing the world’s best superyacht boating events, such as the Loro Piana Superyacht Regatta and the annual Maxi Yacht Rolex Cup.
Listed as the world’s second-most expensive marina, Marina di Porto Cervo is the mecca of the world’s most sophisticated superyachts: Flying Fox, Dilbar, Sailing Yacht A, My Solaris and Nord to mention a few.
Invest in high yield property overseas. Thanks to the rise of platforms like Airbnb, the market for hospitality and travel lodging has grown tremendously in recent years. Domestic and international investors are now looking to purchase properties specifically for short-term vacation rentals. In addition to private equity funds, HNW individuals are also turning their attention to second homes as a revenue stream.
Your way to become successful. Owning a property in one of Sardinia’s top location is a status symbol for international’s jet-set society. Costa Smeralda dates from 1962, when the billionaire philanthropist and spiritual leader Karim Aga Khan created a private consortium to buy the north-eastern strip of coastline. Thanks to a strong fundamentals, Costa Smeralda’s real estate market is in extremely high demand: with one of the lowest levels of supply and its important structurally unmet demand base, Costa Smeralda represents a significant and interesting opportunity for investors who wish to diversify asset classes in the portfolio.
Hotel as a capital investment. The famous architect Jacques Couelle, visionary and ecologist, projected these cave-style houses in the 60s. Couelle’s signature style means an introspective architecture, design choices which seems more focused on hiding than showing off. An eccentric character, nicknamed the architect of billionaires, J Couelle produced a true masterpiece of art which has become famous all over the world: the Hotel Cala di Volpe represents an authentic institution within the international luxury world, an icon of style and refined hospitality.
Harrods Interior Design have been shortlisted for Hotel Suite – Europe Award in The International Hotel and Property Awards 2021. The Harrods Suite, Cala di Volpe Hotel by Harrods Interior Design was a special opportunity to amalgamate two iconic brands, combining Hotel Cala Di Volpe’s Sardinian indigenous luxury with Harrods excellence. The timeless charm of a unique architecture: embedded into the area’s cultural context, the suite features exceptional architecture detailing and bespoke interior furnishings with sweeping views of Hotel Cala Di Volpe’s renowned coastline.
Our goal at TROPHYASSET.TRAVEL is to encourage innovation and develop sensory buildings to support the ultimate customer experience: the new ideal home is increasingly technological and connected to the needs of the users
Value-add properties are those whose value can be increased with selective measures, in the right location and with a deep understanding of the sector concerned. Value-add investments undoubtedly call for a greater risk appetite, but they also increase good prospects for a boost in development and innovation through modernisation, renovation and repositioning.
Many of the seaside villas in lovely and unique locations on the Costa Smeralda were built during the v80s and 90s. Only a few of them have been renewed over time and, above all the finishes and the internal layout, often no longer correspond to the canons of modern design.
Those who, in recent years, have purchased, renovated and resold properties with fine finishes and adapted to the current customers taste, have enjoyed comfortable profits. The Costa Smeralda is a unique destination and location and therefore those who know how to enhance the existing heritage will always be able to benefit from very interesting rents and margins.
Whether it’s an existing project that needs a refresh, taking on a project’s development phases, or a conversion from hotel to a condo or viceversa, our vertically integrated team specializes in the end-to-end development of the finest estates and dream homes in the world’s most sought-after destinations.
A comprehensive package of services includes: Ground-Up Development, Value Add Development, Rebranding / Repositioning, Hospitality Operations, Asset Management, Luxury Rental Management, Investment Advisory, Portfolio Management.
The revenue model adopted by trophyasset.travel aim to provide an outperformance without significantly increasing the risk profile of the portfolio.
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Distressed assets are hitting the market: demand for convertible properties has skyrocketed over the past year. Many of the properties identified for potential repositioning were not significant performers prior to Covid-19. Location is key for those looking to convert. There continues to be a deep bench of investors looking for high performing, best-in-class assets with excellent surrounding demographics.
Risk tollerance, time horizon, return objectives: we offer our clients off-market development and value-added real estate investment opportunities characterised by attractive risk-adjusted return profiles. Our capabilities reach across the risk/return spectrum, ranging from value-add to opportunistic strategies. We define and manage investment strategies, source the deal-flow, transactions and real estate development from beginning to end – handling every detail on behalf of investor – in order to deliver the largest return on investment.
Discover why it is a good time to increase exposure to Alternative Investments and why real estate makes a good bet for portfolio diversification. Learn more on asset allocation strategies in the modern investing landscape with Valeria!