EDINBURGH has been rated as the most attractive UK city outside London for hotel investment for a fourth straight year.

Senior hospitality industry leaders surveyed by accountancy firm Deloitte identified Edinburgh as the most attractive hotel investment destination in the UK outside London by a significant margin.

Manchester was again second to Edinburgh, with the university towns of Cambridge and Oxford respectively in third and fourth position, and Bath completing the top five in terms of the most attractive UK cities for investment in the sector excluding London.

Nikola Reid, director and head of UK hospitality at Deloitte, said of the results of the latest European Hotel Investment Survey: “Edinburgh and Manchester are robust hotel markets with strong occupancy levels and have a track record of absorbing new supply. Appetite for hotel investments in the UK university towns of Bath, Oxford and Cambridge is not surprising due to high barriers to entry and their strong leisure appeal in the wake of tourism from overseas while the pound remains weak.”

Sterling tumbled in the wake of last year’s Brexit vote.

Various surveys have signalled that Edinburgh’s already strongly performing hotel sector has received a considerable boost from the weaker pound, which has made the UK cheaper for overseas visitors.

More than two-thirds of survey respondents cited Brexit as a key risk to the UK hotel industry. The next biggest risks identified were slow economic growth, and a shortage of skilled labour. Hotel industry players have in recent times highlighted fears that Brexit will lead to labour shortages, given the sector’s dependence on staff from overseas. UK economic growth has slowed sharply this year, with economists highlighting a drag from Brexit.

Amsterdam was named as the most attractive European city for hotel investment for a second consecutive year. It was followed by Barcelona and Dublin.

London, in second place last year, slipped to fourth position in the latest European rankings. Madrid is in fifth position.

Andreas Scriven, Deloitte’s head of hospitality and leisure , said: “It is not surprising to see London slip down the pecking order, with concerns of over-supply, high pricing and uncertainty starting to bite. Investors may be questioning how much value they can get out of the city, despite the weak pound and the city being a stand-out destination for both business and leisure.”