Finney Marc
Finney Marc

Inverness beats Edinburgh to top Scottish Hotel Index

Inverness has emerged as the surprise leader in Colliers International’s inaugural Scottish Hotel Index, as a combination of strong levels of demand; rising Average Daily Rates (ADR); a low active pipeline; relatively low development costs and high occupancy levels, allowed it to beat Edinburgh into second place.

Colliers’ Scottish Hotel Index involves the analysis of five locations across Scotland and ranks them according to nine key indicators, to determine the ‘hot spots’ for hotel development and acquisition across the country. It has found that Inverness is the most attractive market for investors, followed by Edinburgh and then Glasgow, Perth and Dundee, and Aberdeen.

Marc Finney, Head of Hotels & Resorts Consulting at Colliers International, said: “Our Scottish Hotels Market Index shows the changes taking place in the sector. The study in particular, highlights that Inverness is not necessarily the best hotel market north of the border, but it is currently providing the best opportunities in Scotland. Inverness has recorded high levels of demand of around 80% over the past four years, which has enabled ADR to rise by 22% between 2013 and 2016. It is cheap to acquire hotel sites there, providing investors with much better value for money than, say, Edinburgh.”

Alistair Letham, the Scottish director in the UK Hotels Agency team at Colliers International, added: “Crucially the index shows that hotel performance is on an upward trend in Inverness, and there is little new stock of guest rooms in development. Despite being expensive, Edinburgh is also on an upward trend and has one of the highest ADR in Scotland and the UK at £93 at the end of 2016. So the capital rightly deserves its position in the UK top ten.”