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2024 Update Coming Soon Published Date: August 2022 Number of Pages: 138
With most international destinations to visit and strong recovery of domestic tourism, Europe is the most attractive destination across the word. Approximately 460 new hotels opened in Europe in 2021, with the number of hotel launches only expected to grow further in 2022.
Owing to its leading role in the global tourism market, the hospitality sector is one of the key drivers of the European economy, and European tourism, both in terms of employment as well as of direct contribution to revenue generation in the economy.
Together with tourism, the hospitality sector is the 3rd largest socio-economic activity in Europe.The hotel market in Europe has benefited from a prolonged economic boom in recent years.
With developments in globalisation, digitalisation and urbanisation, however, increasing changes can be felt in the hotel industry. Accordingly, the hotel industry is currently facing numerous challenges with regard to customer and work behaviour, sales models and real estate.
For example, there is an increasing trend towards people working independently of particular locations (“footloose service sector industry”) and feeling at home in many places at the same time. Hotels will therefore play a new role in the future – they will become people’s homes away from home.
This means that the current trend is moving away from classic hotels and traditional hotel formats towards options that are more tailored to the needs of customers, beyond just somewhere to sleep for the night.
The hotel industry is increasingly forced to strike a balance between a place of recreation and a workplace. In addition, solutions must be developed that align the digital revolution with increasingly diverse human needs. Hotels that do not react adequately and quickly to changes in future trends will ultimately miss the boat.
However, the fundamentals of the European hotel industry remain strong: key hotel markets such as London, Paris, and Rome are generally supply constrained and continue to show significant demand growth both from within the continent and from overseas visitors.
As a result of these wider economic and tourism trends, the European hotel industry has seen demand-led RevPAR growth in 2019 and managed to maintain profitability levels despite pressure on margins through increasing wage costs.
Ruby Luna.
The current unsteady hospitality market is the perfect time to combine shrewd, long-term investment with leisure and corporate guests’ requirements for hotel brands that prioritize a positive environmental impact.
UK Hotel transactions volumes exceeded £1.5 billion for Jan-Apr 2022 compared to an impressive £4 billion of UK hotel transactions in 2021, emphasising the growing investor sentiment and optimism over the long-term prospects for the sector.
The underlying drivers of increased hotel demand, the continued improvement in profitability and visibility for future trading, have all contributed to the improved sentiment towards the sector.
Europe’s largest hotel operator Accor entered negotiation to sell 10.8% stake in Ennismore, a global collection of leading lifestyle hospitality brands, to a Qatari consortium, for a total amount of €185 million.This deal is expected to close H2 2022.
Mandarin Oriental Hotel Group is planning to expand its branches in France, Barcelona and Greece.
Germany and the UK account for nearly 60% of pipeline rooms currently under construction and are expected to absorb additional supply in the medium term due to strong tourism growth forecasts.Hotel construction continues in Europe despite the pandemic, with investors looking to Germany to set the tone for the rest of the continent,
With the opening of Ajul Luxury Hotel & Spa Resort, Wyndham launched Registry Collection throughout Europe. Halkidiki, one of Greece’s most popular tourist locations, is home to the 171-room, 5-star resort.
Halkidiki is renowned for its clean beaches, Mediterranean woods, and exceptional views of the Aegean Sea and Mount Olympus. Registry Collection Hotels are carefully chosen to provide extraordinary experiences in breathtaking settings.
They blend originality with thoughtful design and top-notch service. Every stay at Registry Collection properties is intended to be as distinctive and opulent as the properties themselves, from distinctive architectural features to dream-worthy locations.
The Ajul Luxury Hotel & Spa Resort is the newest luxurious addition to a portfolio of 16 Registry Collection properties spread across Mexico, Panama, Brazil, the Dominican Republic, and Jamaica. It is owned and managed by Zeus International Hotels & Resorts.
By extending Registry Collection Hotels to Europe, they can vary their offerings even more and provide customers with access to a wider range of amazing travel opportunities and locations. Having many years of expertise greeting guests and building businesses throughout Europe, Zeus International Hotels & Resorts is a partner with similar values.
This event is made even more memorable by the fact that it takes place with them in Halkidiki, a popular destination known for its stunning landscape, coastline, and culture.
The impressive Ajul Luxury Hotel & Spa Resort’s most recent opening adds to Wyndham Hotels & Resorts’ long-standing partnership with Zeus International Hotels & Resorts, which currently encompasses 10 properties across three nations under the Wyndham, Wyndham Grand, Ramada, Dolce, and Trademark Collection by Wyndham brands, as well as Registry Collection Hotels.
Ajul Luxury Hotel & Spa Resort, a Registry Collection Hotel, is a gorgeous beachfront establishment with 171 opulent rooms measuring up to 85 square metres.
This number includes 26 exquisite private villas measuring up to 580 square metres and 92 excellent bungalows measuring up to 135 square metres, all of which include private pools and breathtaking views of the ocean.
In addition to access to the neighbouring lovely pebble beach, the hotel offers five amazing swimming pools. Visitors can fully immerse themselves in the peaceful atmosphere by taking leisurely strolls through the hotel’s lush gardens, which gracefully descend towards the tranquil waters of Agia Paraskeui.
The hotel was built in an alluring setting of forests, where natural tranquillity and traditional natural elements are prominent.
In honour of the area’s rich therapeutic legacy, visitors may also take advantage of a unique Spa Centre with a stunning outdoor pool and breathtaking vistas, as well as wellness sessions on designated decks by the beach.
The ideal luxury hideaway for those seeking a breathtaking seaside retreat, Ajul Luxury Hotel & Spa Resort also offers more daring visitors two tennis courts, a basketball court, a beach volleyball court, as well as an adventure park and other fantastic outdoor activities.
The Ajul Luxury Hotel & Spa Resort is a superb option for visitors looking for the ideal location for such occasions because it has over 600 sq m of venue space for hosting opulent events and elite conferences.
Hotel industry in Europe’s market size was estimated at ~EUR XX Billion in 2023. As compared with 2022, revenues increased by ~XX% in 2023 YOY but the market will also see a steep recovery in 2023 led by domestic and leisure tourism. It is only By 2024, that the market will be able to reach pre-covid levels of around ~EUR XX Billion
The Chained Hotel industry in Europe market size is expected to grow at ~XX% CAGR between 2024-2030. The demand from domestic travelers in the short term and luxury hotel segment led by leisure trips holds higher growth potential.
Much quicker reopening of hotels especially in high demand bases like that of Germany, United Kingdom, Spain. Cross-border demand has begun to return, propelled largely by drive-to and rail-connected intraregional movement.
The most visited continent in the world is Europe. No matter which nations are visited, Europe’s tourism has it all, from breath-takingly beautiful natural surroundings that will take the breath away to deeply ingrained culture and traditions that are still present to vibrant culinary experiences that will tantalise taste buds in the best way possible to entertaining festivals that promise something for everyone.
Location, size, and on-site properties are some of the variables that affect hotel demand, which varies depending on the type of facility. The emergence of low-cost flight services, the expansion of weekend culture, increased disposable income, and the booming service sector are all expected to drive the industry.
In order to provide its guests with a pleasant stay experience, a hotel is considered to be luxury. High-end accommodations frequently accept high-paying guests, and they are expected to receive top-notch services and meals.
Sustainability is one of the key design elements of luxury resorts, and major hotel chains are increasing their commitment to adopting sustainable practices and persuading the general public of these actions.
Designing a hotel with sustainability in mind entails optimising how the structure operates to reduce its environmental effect while also enhancing the comfort and health of its visitors.
Hotels and resorts are increasingly integrating cutting-edge and developing technology to improve the guest experience, meet the demands of tech-savvy customers, and better serve their guests. This helps them stand out from the competition, improve the efficiency of their facilities, and increase revenue per room.
Hotels will need to use intelligent technologies including artificial intelligence (AI), robots, the Internet of Things (IoT), better audio-visual technology, voice and hand gesture controls, and the built environment.
Before using smart technologies, it’s critical to consider the potential return on investment, how well the technology blends with the hotel’s overall strategic positioning and design, and how the technology might alter and customise the guest experience.
Visitors may have greater control over their stay because of smart technology, and more and more guests are clamouring for features like keyless entry into rooms, smartphone check-ins and payments, and mobile bookings.
Smart technology’s capacity to recall in-room choices has the potential to personalise the visitor experience, establish a distinctive sense of place, and raise general customer satisfaction.
High-tech amenities can be managed by guests through their phones or control panels in their rooms, including upmarket room lighting, projection film, aroma features, temperature and ventilation management, smart windows that control ambient light, and music over Bluetooth speakers.
As one indicator of hotel demand growth, the EU average is raised by the growth of Eastern European countries such as Poland, Hungary, and Romania, while Western Europe is expecting milder growth in the tourism sector.
The post-pandemic recovery of the European travel and tourism industry could be put at serious risk if almost 1.2 million jobs remain unfilled across the EU. And the current shortages of labour can delay this trend and put additional pressure on an already embattled sector.
As a result of the decade-long low interest rate environment in Europe, institutional investors searching for yield have continued to show increasing interest in European hotels.
Total investment volume for the first four months of 2022 is already some 40% ahead of H1-2021. Transactional activity has been relatively evenly split, with London securing approximately £750 million of investment, whilst regional UK achieved over £800m of hotel transactions.
With European income growth outpacing inflation, the increase in purchasing power combined with the continued growth of inbound visitation are likely to support continued demand growth for hotels in the near term.
Home to world-famous spots and host to notable international events, France is the leading European travel destination for international tourists. The capital city, Paris, attracted over 16.8 million international sightseers every year.
After 2 years of major pandemic disruption, the hotel industry business rebounded sharply in H1 2022. This rebound resulted due to an increased number of business and leisure domestic guests and borders reopening for international tourists too.
The European travel market is expected to be driven by leisure travelers at least for the mid-term due to the pent-up demand of 2021.Western Europe comprising Germany, France, and Switzerland among others serves as an important destination for both domestic and International Tourism.
International tourist arrivals recovered strongly in 2022, but these levels are still below compared to 2019 by an average of 36%. The arrivals in the European region registered 280% growth in Q1 2022 over Q1 2021.
Reduction in Covid-related restrictions and recovery in pent-up demand for Europe destinations accelerated the international tourist arrival in Europe and is expected to continue in the remaining months of 2022.
As hotels ramp up their business, those benefiting from drive-to leisure demand are experiencing encouraging levels of performance. Some, especially those relying on international visitors, will take longer to see Pre- Covid levels of business return, with those reliant on MICE business taking longer still.
A vaccine will help to accelerate some of this growth but, in any event, it is certain that the hotel sector will eventually produce strong returns again and remain attractive to investors who recognize their longer-term earnings potential.
The sharing economy megatrend, here in the form of co-working, is one of the major market opportunities for the hotel industry. The flexible office space market is booming across Europe, and hotel operators are already capitalising on it.
For Micro hotels, which are also referred as Boutique Hotels, investment is seen rising in 2022. These hotels are smaller in size with 10-100 rooms but come with an unequalled level of hospitality and an original array of aesthetics that adds to the flavorful atmosphere.
Transforming hotel lobbies into communal workspaces is an innovative way for hotel brands to maximize the earning potential of real estate assets, in turn strengthening their brand amongst guests and the wider community.
More and more business people travel and use hotel rooms, lobbies, cafés and restaurants as places to hold meetings or concentrate on their work. The still relatively new phenomenon of flexible, time-based rental of office workplaces, which includes a community element, has become increasingly commonplace in recent years.
In the future, the demand for co-working spaces and work-from-hotel trends is expected to bring about major changes in the hotel industry and foster its quick recovery in times of uncertainty.
BY HOTEL TYPE
BY LOCATION AND EXPERIENCE
BY BUDGET AND STAR RATING
BY REGION
The hotel industry in Europe is highly fragmented with many International chains as well as regional players under one roof. However, with just five players accounting for almost ~50% market share in 2021. The growth of the leaders’ portfolios and the rise of some challengers marked the chain supply’s resilience.
Whitbread and Scandic Hotels are the most popular operators in 2021 with a very wide presence. Marriott, Accor and Hilton hotels are scaling up rapidly post COVID-19. Whitbread Hotels registered a positive profit margin, irrespective of the decline in business travel.
Europe hosts a number of key market players which dominate the market scenario. In recent years, New entrants like Airbnb have also done well and managed to stand at par with these mega hotel chains owing to its preferred pricing strategies and easability.
Diverse sources of core and core-plus capital are increasingly considering investment in the hotel market. Private equity groups and other yield-driven investors face more competition from investors with a lower cost of capital and are expected to continue to move into secondary markets such as Portugal and Italy.
