# Hotel Investors – should they be worried about a potential economic pause?’ delving into inflation, interest rates, recession etc
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-08-10
Category: INVESTING
Category URL: https://financedigest.com/category/investing
Meta Title: Why Now is the Best Time for Hotel Investment in UK
Meta Description: Discover why now is the perfect time to invest in hotels post-COVID, with expert advice from Korosh Farazad of Farazad Investments. Don't miss out on
URL: https://financedigest.com/hotel-investors-should-they-be-worried-about-a-potential-economic-pause-delving-into-inflation-interest-rates-recession-etchtml

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_By_ **_Korosh Farazad,_** _acting CEO of Farazad Investments_

As a hotel Investor, I see any opportunity within the sector to be positive (for the right price).  We have first-hand witnessed during this holiday season how travellers already [exceeded in terms of volume pre-COVID numbers](https://www.financedigest.com/number-of-emv-card-present-transactions-exceeds-42-globally.html "Number of EMV Card – Present Transactions exceeds 42% globally") ten-folds.  [People will not stop travelling post](https://www.financedigest.com/life-post-brexit-people-must-take-precedent.html "Life post Brexit – people must take precedent") 2-years of travel restrictions and this in reality is only going to increase considering everyone has been trapped indoors for this period. I do believe the [interest rates](https://www.financedigest.com/interest-rates-are-cut-to-an-all-time-low-what-will-this-mean-for-small-businesses.html "Interest rates are cut to an all-time low. What will this mean for small businesses?") and inflation will cause prices to potentially go further down by 5-10% from guide price; however, I do not see a nosedive as we have seen in the crypto market or other forms of digital platforms. [Brick and mortar](https://www.financedigest.com/influx-of-one-time-investors-swapping-stocks-for-bricks-and-mortar-reports-agency.html "Influx of ‘one-time’ investors swapping stocks for bricks and mortar reports agency") always win. We regularly see nosedives within the crypto market and that can happen for a number of reasons; but the main reason is because of a change in sentiment… Just like when something becomes fashionable, it can also [become unfashionable in a moment’s notice and in turn](https://www.financedigest.com/croatias-coast-turns-to-solar-in-bid-to-become-energy-sustainable.html "Croatia’s coast turns to solar in bid to become energy-sustainable") it can drive down the value of said product. This is why something like the crypto markets which are typically sentiment driven [investments are so dangerous to investors](https://www.financedigest.com/why-are-investors-checking-out-of-uk-buy-to-let-and-checking-in-to-hotel-investment.html "WHY ARE INVESTORS CHECKING OUT OF UK BUY-TO-LET AND CHECKING IN TO HOTEL INVESTMENT?") as they are incredibly unstable and difficult to predict in the day-to-day.

At present, the [higher interest rates](https://www.financedigest.com/dollar-jumps-as-powell-flags-higher-terminal-rate.html "Dollar jumps as Powell flags higher terminal rate") are balancing supply and demand. This is because with high interest, less people are borrowing and, in turn, less people are buying which gives supply numbers the time to increase and demand to decrease; therefore, if an asset is acquired today for the right value, it would provide a future surplus value provided the appropriate structuring is taken into place to balance current [inflation and higher interest rates](https://www.financedigest.com/uk-inflation-rate-unexpectedly-rises-to-10-4-in-february.html "UK inflation rate unexpectedly rises to 10.4% in February").  The current [global economic](https://www.financedigest.com/the-demand-for-agile-banking-during-the-global-economic-slowdown.html "The demand for ‘Agile Banking’ during the global economic slowdown") shocks are with us for next 18-24-months as it takes time for these things to turnover and develop.  Therefore, I personally do not [see a reason why good opportunities should not be considered and acquired for the right value as nothing will change](https://www.financedigest.com/the-sepsis-therapeutics-market-to-see-through-the-probable-sea-change-through-digitization.html "The Sepsis Therapeutics Market to see through the probable sea change through digitization") for at least that period of time.  Sellers also need to be somewhat pragmatic with their guide [price if they are forced to sell](https://www.financedigest.com/3-tricks-to-get-a-better-price-when-selling-your-car.html "3 Tricks To Get a Better Price When Selling Your Car").  Otherwise, [investors are well educated to see](https://www.financedigest.com/analysis-weary-investors-see-little-respite-to-fed-hike-gloom.html "Analysis-Weary investors see little respite to Fed hike gloom") the value for money in acquiring the asset and the value at a 5-year exit which isn’t good for themselves.

For example, approximately 6 months ago we were looking at a hotel [investment for a guide price of £160 million](https://www.financedigest.com/nissan-renault-to-invest-600-million-to-make-6-new-models-in-india.html "Nissan, Renault to invest 0 million to make 6 new models in India") and now the exact same asset has been reduced to £145 million pounds. We were at that time, ready to pay that money, now buying it at £15 million discount gives us, [equity investors](https://www.financedigest.com/uk-investors-add-1-2-billion-to-equity-funds-in-march-calastone.html "UK investors add .2 billion to equity funds in March – Calastone"), higher value-add in the long run under the basis of a lower purchase price. This proves that now is a fantastic [time to buy because you can get much more for your money](https://www.financedigest.com/how-to-use-algorithms-to-save-time-and-make-money-when-trading-currency-crypto-shares-etc.html "How to use algorithms to save time and make money when trading (currency, crypto, shares etc)") for doing the same amount of work. Sooner or later, [inflation will decrease and that will result in the investment markets](https://www.financedigest.com/hungarys-booming-wedding-market-doused-by-soaring-inflation.html "Hungary’s booming wedding market doused by soaring inflation") to start becoming more competitive again.


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