By Katie Allen

Independent UK law firm Burges Salmon has observed a notable trend of UK property owners and developers converting office buildings into hotels. Indeed, the volume of office-to-hotel sales in the UK increased by £368m in 2023, up from £55m in 2022. This trend has continued into 2024 and, it is estimated, more than 25% of office sales over the past 12 months have been by developers looking to convert office buildings into hotels. 

The rise of remote and hybrid working has caused a decrease in the demand for traditional office spaces, with an estimated 35% decrease in office rentals reported across the UK last year. As UK overnight stays in hotels are projected to surpass 2019 levels in 2024, office-to-hotel conversions have emerged as a viable and attractive option for property owners and developers. This trend is particularly prominent in cities like London and Edinburgh, where the demand for hotel accommodation remains robust. Moreover, several local authorities, including the City of London, have encouraged this trend which has, in some cases led to more expedient planning application timelines for office-to-hotel conversions.

As the market continues to evolve, Burges Salmon is well-positioned to provide full-service support within the dynamic Built Environment sector having recently advised a on a multi-million-pound loan facility to support the development of a boutique hotel in central London (which you can read about here).