A series of large portfolio transactions contributed to the trend, with hotel investment over the past six months surpassing the £2bn recorded in the whole of last year.

Transaction activity in H1 2024 was just 10% lower than the pre-pandemic level recorded in H1 2019.

Significant deals in 2024 included Blackstone’s £850m acquisition of a 33-strong regional Village Leisure portfolio and Starwood Capital’s £800m purchase of 10 Radisson Edwardian Hotels in London.

The past six months also featured Landsec’s £400m disposal of its hotel portfolio to Ares Management, where Knight Frank advised the vendor.

According to Knight Frank, market dynamics have helped drive these transactions to the benefit of sellers.

Historically, hotel investment has been driven by a mix of sizeable portfolio and single asset deals.

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In 2024, there has been a lack of the latter which has reduced transaction volume by 34% from the previous year.

Portfolio transactions accounted for 76% of the total H1 transaction volume, compared to just 53% in H1 2019 when a similar level of portfolio transactions took place.

Knight Frank has described the outlook for the rest of 2024 as “encouraging”, highlighting greater momentum in the UK hotel sector.

Henry Jackson, partner and head of hotel agency at Knight Frank, said: “An increase in the quality and the number of hotels seeking to transact is expected, as hotel owners who have extended their investment cycles now seek to realise their exit strategies.

“Where a particular asset meets all the investment criteria, we have seen certain buyers willing to pay full prices for these assets.

“With a strong pipeline of hotels currently in legals, the Knight Frank Hotels teams expects this momentum to continue, and an interest rate cut will serve to further enhance the current optimism for investment in the UK hotel market.”