Grand Hotel de la Minerve in Rome, which was sold in February. Reuters

International investors are casting an eye over some of Italy’s grandest hotels whose family owners may be persuaded to part with properties that can be refurbished in time for tourists to return.

The number of guests in Italian hotels more than halved in 2020 and the chances of a rebound this year have dimmed as the country fights a third wave of the COVID-19 pandemic.

Italian tourism agency ENIT sees visitor numbers bouncing back to surpass pre-pandemic levels by 2023, but investors hope the wait will prove too long for many struggling owners.

“M&A activity is concentrated on trophy assets for which the pandemic has been a game-changer: family owners that would never have considered selling in the past are now willing to hold discussions,” said Marco Zalamena, head of hospitality at consultants EY.

In February, Italy’s Billi family sold Rome’s Grand Hotel de la Minerve to domestic investment fund Arsenale.

Chief Executive Paolo Barletta, who launched Arsenale with jewellery billionaire Nicola Bulgari, told Reuters he expected competition for Italian assets to heat up.

Barletta predicts big hotel chains, which currently account for just 7% of the Italian hotel sector, will own 25-30% of the market within a decade. With over 32,700 hotels and 1.1 million rooms, according to Eurostat, Italy has the biggest hotel portfolio in Europe, ahead of Germany (32,200 hotels) and Spain (19,700 hotels).

At least four luxury hotels are currently up for sale, according to two sources with knowledge of the market.

Among them are the family-owned five-star Majestic Hotel as well as the Grand Hotel Via Veneto, a few minutes walk from each other on Rome’s famed Via Veneto.

In the north, Hotel Britannia is for sale on the shores of Lake Como, while real estate equity firm Aina Hospitality has put Milan’s Four Points Hotel on the block, the sources said, on condition of anonymity as the information is not public.

Hotel Britannia owner Ross Whieldon confirmed he and his wife were sounding out the market for a possible sale, but added they would be happy to keep it. “It depends on how good the offers are, we have not made a decision yet,” he told Reuters.

The other hotel owners did not respond to requests for comment.

In Venice, which in 2020 took the lion’s share of investments in Italy’s hotel sector, the private owners of Hotel Palace Bonvecchiati next to St. Mark’s Square held preliminary talks with an investor last year, the sources said.

Eligio Paties, one of the hotel’s two owners, told Reuters the talks ended quickly, and they were not interested in a sale for now. “People are calling us every day,” he said.

Fewer hotels changed hands in Italy last year as the pandemic raged and rooms stood empty.

Deals more than halved to 31 in 2020 for a total of 1 billion euros ($1.2 billion), down from a peak of more than 3 billion euros from 67 transactions in 2019, according to EY.

That trend was reflected across Europe, with real estate consultancy CBRE pointing to a 75% decline in France and a 60% drop in both Spain and Germany.