Budapest goes from strength to strength, with a record number of new hotels opening in Europe in the next three years
Although the uncertainty caused by the emergence of the new virus variant has led to the cancellation of several year-end events in restaurants and hotels, the emergence of the omicron variant has had only a limited impact on the steady improvement in hotel bookings in Budapest since the end of the summer, Moore Hungary shared its market experience.
In the wake of the uncertain and often conflicting reports surrounding the new virus variant, travel restrictions have been reintroduced in many countries, to varying degrees, in recent weeks, and the administrative burden of planning travel has increased significantly.
Hungary following fears linked to omicron the company organisation event venues, restaurants and hotels most end-of-year events cancelled. However, thanks to Hungary's lax epidemiological legislation, which is lax by international standards the number of hotel room bookings in the capital did not fall in international comparison to a significant extent.
„Many foreign visitors Budapest hotel management reports that the steady improvement in room occupancy rates since August did not stop in December, and favourable occupancy rates are usually accompanied by appropriate room-average also ” - said Márton Takács, head of the hotel and tourism consultancy business of Moore Hungary.
The emergence of newer and newer variants is apparently inevitable, but the only sustainable way to protect against them is to maximise the vaccination of the population, rather than systematically disrupting business through restrictions. The impact of this change in approach is the hotel market is showing signs of a gradual recovery, less and less dependent on the current epidemic waves. The positive outcome of the pandemic, which has now lasted more than a year and a half, is that the hotel and tourism sector in both the US and European markets growing business resilience and adaptability, and a range of sectoral innovations you can also find.
Europe now above the world average
Until this spring, the often radically different and opaque restrictive measures in European countries have had a major impact on the performance of the hotel market across the continent. While the average capacity utilisation of European hotels has consistently lagged behind the global average, the gradual opening up from April 2021 has resulted in an explosion of growth, with the European hotel market now performing above the global average at around 60% for months.
Hotel investment in Europe could reach an all-time high
The delivery target dates for hotel investments in Europe have been delayed for most projects during the covid period, while the total number of hotel openings expected between 2022-2025 has fallen less than expected, which together could result in the number of new hotel rooms coming on to the market could reach an all-time high in the next three years.
According to reports from data companies that track international investment volumes only the following year in Europe (including Russia) around 100,000 new hotel rooms will be delivered. The highest volumes are forecast in the UK and Germany, followed by Spain, Poland and Russia in terms of hotel investment activity.
„The significant increase in supply is expected to slow down the current dynamic growth rate of average occupancy rates, but the strong presence of new investments with a higher quality of supply and a focus on ESG „green” aspects is certainly a positive market phenomenon,” added Moore Hungary.
Moore Hungary
Moore Global, which started in a London office more than 110 years ago, is now one of the world's leading consulting and audit networks. Present in over 100 countries worldwide, the network has more than 600 independent offices and over 30,000 employees. The group's turnover for the last financial year exceeded $3 billion.
Moore Global's services will be directly available in the domestic market from March 2021. Moore Hungary has been offering a full range of consulting services in the fields of business, financial, tax, accounting and auditing with a team of almost 100 experts since its inception.
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