Image: The UK hotel market has remained relatively strong

The European hotel investment market continues to struggle amid the scarcity of debt and economic uncertainties within the Eurozone.

Figures from consulting and services organisation HSV London show that the investment market has fallen by 16 per cent during the first eight months of 2012 and the company expects the stagnation to last "at least until the end of the year".

The first eight months of 2012 saw hotel investment activity in Europe total around 3.5bn euro (£2.8bn).

Troubles with the single currency are reflected in the fact that the majority of investment during 2012 has been based in the UK, where volume reached more than 1bn euro (£800m), 46 per cent of overall single asset investment volume.

In London some 12 premium hotels (with a market value of above 7.5m euro, £6m) changed hands including the four-star Cavendish London for just under 200m euro (£160m).

A number of hotel development sites have also been sold in London, including the InterContinental Westminster and Hilton Bankside. In addition, the Odeon Site in Leicester Square has recently been acquired by the Edwardian Group.

Markets in France and Germany performed the best within the Eurozone countries, with 15 per cent an 11 per cent of total single asset investment volume respectively.

Between them, the three major markets now count for 72 per cent of all European deals - demonstrating the troubles experienced in traditionally strong markets such as Spain, Greece and Italy.

Tim Smith, director of HVS London, said: "Until debt becomes more readily available and trading significantly improves, it is difficult to estimate when the hotel investment market will improve but we hope to see transaction figures rising during 2013."