The value of hotels in central London exceeds offices and residential property according to a survey by international property advisor, FPDSavills.

Research states that the value of hotel buildings grew by 123 per cent between March 1997 and September 2001. This rate of capital growth is more than both offices and residential properties achieved during the same period.

But FPDSavills' researches believe that hotel building values are likely to fall by five per cent by the end of March. 'The rate of value growth slowed dramatically between March and September 2001,' said head of research at FPDSavills, Yolande Barnes. 'The signs are that business hotels with a stronger UK base of visitors will hold up better than buildings in locations more dependent on tourist trade.'

In the longer term, the survey predicts a shift from traditional converted buildings towards new, purpose-built hotels and that hotel site values will suffer, falling as much as 15 per cent.