Hotels & Hospitality The future of open air hospitality across Europe - Research
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February 2021 Research Hotels & Hospitality The future of open air hospitality across Europe
Investment surge for open air hospitality
The coronavirus pandemic sent the hospitality industry into a downward spiral throughout Europe. While more
than 850,000 hotel rooms closed and international travel ceased, there was one hospitality segment that benefited
from an increase in domestic “staycation” demand, open air hospitality.
Open air hospitality venues include everything from caravan parks, holiday parks, campsites and glamping. In this
paper, we focus on open air holiday parks, which have seen huge interest from both holiday makers and investors
during the last 12 months and we expect an investment surge in this segment of the market moving forward. We
will explore in detail the reasons behind this, and our views on the potential future landscape across Europe.
Hotels & Hospitality | 2
Who are the key players?
There are a number of key players in the holiday park The European holiday park market is fragmented,
market throughout Europe as highlighted in the table with both inland and coastal locations. Nothern
below. While the product offering varies by nature, Europe is historically more advanced in this sector
they typically provide self-catering lodges or cabins with parks across the UK, the Netherlands, France
set within a woodland landscape or along coastal and Germany and tend to be within visitor location
locations. One of the big attractions of holiday parks is hotspots. While holiday parks and campsites in Spain
that alongside self-catering accommodation, there are are not as widespread, the warmer climes of Southern
usually central facilities including restaurants and bars, Europe could undoubtedly benefit from these types of
a pool complex and various function suites offering accommodation and create development oportunities.
day/evening entertainment. In addition, guests have
the ability to book various outdoor activities to enjoy
during their stay.
Selection of leading holiday park owners and operators in Europe
Operator No of Location
Parks
Bourne Leisure
40 UK
(excl. Warner)
Center Parcs Germany, France,
25
Europe Netherlands, Belgium
Center
7 UK & Ireland
Parcs UK
Droomparken 19 Netherlands
EuroParcs Resorts 18 Netherlands
Forest Holidays 11 UK
Denmark
UK, Germany, Ireland
Netherlands, Belgium,
Landal Green 93 UK Netherlands
Austria, Switzerland,
Parcs Germany
Demark, Czech
Republic, Hungary Belgium
Czech
Park Holidays UK 31 UK Hungary
France Austria
Parkdean Resorts 67 UK Switzerland
Germany, Netherlands,
Roompot Parks 122
Belgium
Siblu 21 France, Netherlands
Hotels & Hospitality | 3
Holiday park real estate is mainly owned or leased and rarely franchised or mananaged. This is due to the less
mature and less structured niche market; the type of asset – holiday parks tend to be purpose built, very large lot
sizes with a significant level of investment; and the real estate nature of the business model – the sale of lodges/
static caravan units/houses/cottages with a developer-type approach. Operating models and platforms also differ
between the UK and continental Europe. The table below outlines the key differences:
Operating models of holiday parks
UK Continental Europe
Predominantly owned-operated model. Fragmented Much more active on sale and leaseback.
business model, a market dominated (over 70% of the UK
market) by small family/group owner operators.
Focus on cottages/houses/lodges/static caravans to let as Focus on cottages/houses sold to individuals is key
short term holiday accommodation or sold to individuals and sometimes leveraged by tax incentives (i.e. France).
with ground rent income on a fixed term basis; holiday home Central facilities are more or less developed depending on
sales churn, revenue diversification through central facilities the brands and concepts.
and up selling food and beverage and leisure offerings.
Typically freehold, although there has been a move Real estate is typically based on a Sale and leaseback to
towards ground rent sale and lease back structures at institutional investors with key requirements.
a corporate level.
Sustainable profit margins can range from between 18% to Sustainable average profit margins of approximately
35% of turnover dependent on the style of operation. 15% to 35% on average.
Sale multiples can range between 8% (12.5*multiple) and Real estate yields between 5.75% to 7%.
12.5% (8*multiple) for small mid-scale regional opportunities
and in excess of 6.5% (15*multiple) for premium
opportunities (usually strong coastal or “honey pot”
tourist destinations).
Source: JLL Research
Hotels & Hospitality | 4
Resilience despite pandemic
During the summer of 2020, many countries began to to holiday parks across Europe every year. The overall
ease their travel restrictions. However, others remained dynamics of the leisure market have also changed with
in place, with tourists needing to quarantine on return people no longer taking one big holiday a year, but
from some destinations which prompted a rise in taking two or three shorter holidays.
domestic tourism, in turn boosting demand to open
There is a new generation of guests attracted to holiday
air hospitality venues.
parks too. Children that went to holiday parks with
their families when they were growing up in the 1980’s
After a decline of +90% in nights spent by EU
and 1990’s are now returning with families of their
residents in April 2020, by July, the number own during the peak months of Easter and around the
of nights spent by EU residents in tourist summer school holidays. Grandparents and younger
accommodation in their own country was just couples are also seeking out short stays at holiday parks
22% lower than that in July 2019, as compared during off peak months as they are easily accessible and
to a 64% in nights spent by non-residents. provide all facilities on one site. In terms of the guest
Eurostat experience itself, this too has been upgraded.
Staying at a holiday park also provides affordable
The secret to success of open air hospitality venues
luxury for families, with more beds and space per unit
not only takes into account the easy access drive-to-
compared to traditional hospitality options such as
destinations for many European travellers but they
hotels. As a result, this will appeal to the mass market
also offer home-from-home private accommodation
who will remain resilient if they are able to save money.
facilities and above all, people can enjoy the outdoors
Not only are holiday parks easier to get to saving
safely and securely.
unnecessary overseas travel, but they also provide
Until people have the ability and confidence to travel an escape to nature, providing well needed time for
internationally again, demand for open air hospitality personal wellbeing, both likely to be strong post-covid
venues is expected to rise across Europe. That being trends and an overall greener experience.
said, growth in the sector had already been on the up
before the pandemic with millions of visitors flocking
Hotels & Hospitality | 5
Investors begin to tap in
The momentum of holiday parks and “open-air hospitality” investment is gaining traction in Europe. We have seen
growing interest from investors and large flows of institutional capital acquiring holiday parks and other leisure
operating real estate businesses. The table below represents a selection of holiday park deals that have closed in
Europe over recent years:
Selection of Holiday Park Deals in Europe
Year Transaction Country Buyer Price € Million
2020 Roompot Group Netherlands, Germany KKR €1,000
Center Parcs Belgium, Germany,
2019 Aroundtown SA €1,000
Europe Portfolio Netherlands
2019 Away Resorts UK Bregal Freshstream €72
2019 Park Nordseekuste Germany Atream Confidential
2019 Bunn Leisure UK Cove Communities Undisclosed
2018 Forest Holidays UK Phoenix Equity Partners €124
Intermediate
2017 Park Holidays UK €413
Capital Group
Midlothian
2017 Park Leisure UK €118
Capital Partners
2016 Parkdean Resorts UK Onex Corporation €1,653
2016 Center Parcs Allgäu Germany Eurosic €260
Inspire Learning Bridgepoint
2016 UK €115
Kingswood Development Capital
Brookfield
2015 Centre Parcs UK Portfolio UK €3,306
Properties Ltd.
Center Parcs Les Bois
2014 France PBM €40
aux Daims
Source: JLL Research
Hotels & Hospitality | 6While the coronavirus pandemic has shocked the was the case with the European Center Parcs portfolio
tourism industry on a global scale, buyers trust that acquired by Aroundtown SA in 2019 and more recently
tourism will rebound and holidays parks have proved the Roompot Group, acquired by KKR in 2020. At
their resilience. The pandemic served as a catalyst to the time of writing, it is reported that Blackstone is
facilitate this growing trend, with a rise in domestic seeking to acquire Bourne Leisure in the UK, further
tourism across Europe. In addition, investors trust the strengthening that domestic tourism markets are
business model of holiday parks because they are expected to make a strong recovery, particularly in the
more resilient than other hospitality segments, there is open air hospitality sector.
still untapped upside from operation and upgrading,
Operationally, there is also an opportunity for
and yields are still higher than mainstream hospitality.
consolidation and to create a more sophisticated
Leverage on the holiday parks business model also
product with greater reach. Current holiday park
stems from i) the real estate development generating
operators tend to be the leaders in their domestic
upfront sales of lodges/static caravan units/villas/
market, but there is also an opportunity to extend their
houses/cottages to individuals and ii) from sale and
brands throughout Europe.
leaseback to institutions.
The sector is of particular interest to institutional or
large private equity investors as deals are typically
considerable in size, often in excess of €1 billion as
Hotels & Hospitality | 7More opportunities on the horizon
The coronavirus pandemic has highlighted the resilience From an operational perspective there is considerable
of the open air hospitality market in Europe and upside for holiday parks by investing in upgrading
accelerated demand. While Western European travellers existing accommodation and facilities. Operators will
may have less disposable income to spend in the short be able to increase their overall average rates and
term post-COVID-19, holiday park vacations will remain profit, following the same trend seen by hotel lifestyle
an affordable option. Although younger generations are brands and glamping facilities at camp sites. More
still keen to explore the world and go backpacking, older consolidation in the sector would also generate scale
generations may prefer to holiday closer to home and and synergies to be able to offer an upgraded product
with many parks just a couple of hours drive away, they to guests. As a result, we expect the open air hospitality
immediately become more tempting. Holiday parks sector to provide opportunites for investors for some
also provide a home away from home option for many time to come as an alternative to the mainstream
families across Europe who do not own second homes hospitality sector.
to meet and socialise together in a natural setting that
can boost overall health and well being.
Hotels & Hospitality | 8Contacts:
Gwenola Donet William Rankine
Head of EMEA Hotels Strategic Advisory Associate Director – Hotels & Hospitality Group
Gwenola.Donet@eu.jll.com William.Rankine@eu.jll.com
Ross Petar Jessica Jahns
Head of EMEA Hotels Valuations Head of EMEA Hotels & Hospitality Research
Ross.Petar@eu.jll.com Jessica.Jahns@eu.jll.com
Harry Hawksby
Director - Hotels & Hospitality Group
Harry.Hawksby@eu.jll.com
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© 2021 All rights reserved. The information contained in this document has been compiled from sources believed to be reliable.
Neither Jones Lang LaSalle nor any of its affiliates accept any liability or responsibility for the accuracy or completeness of the
information contained herein. And no reliance should be placed on the information contained in this document.
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