The hospitality industry was among the first affected by the coronavirus crisis and will be among the last to recover. The road to recovery involves establishing a way to make the hotel experience safer, and this year will bring new trends in the hospitality area – minimizing food waste, care for green buildings and sustainability, and a preference for locally produced food, as well as smart devices designed to reduce energy consumption are just some of the trends that will shape a more sustainable future starting in 2021, according to the Colliers annual report for 2020.
Colliers consultants are optimistic about the recovery capacity and investor interest in this market, although the coming years will certainly be difficult.
Some developers have continued their hospitality projects and found ways to negotiate with financing banks, confirming the long-term confidence in this market of players with a robust financial situation.
Regarding future projects, there are still few hotels in progress, and brands are looking for good locations to affiliate with.
By the end of 2021, Colliers consultants expect the opening of the Ibis Airport hotel (85 rooms) and the new luxury hotel Autograph Collection by Marriott in the old center of Bucharest (217 rooms).
Other projects include a new brand under the Accor umbrella (100 rooms), Corinthia Grand Hotel du Boulevard (50 rooms), or the conversion of the Oscar Maugsch Palace, recently sold by BCR to a group of investors from the hotel industry, which are expected to announce their strategy in the near future.
Last year, tourism worldwide reached its lowest level of activity in the last 30 years. In Europe, according to a survey by the World Tourism Organization, most experts see the return of activity to pre-pandemic levels for international travel no earlier than 2023. Moreover, the survey shows that we will see a more significant recovery in international tourism in the second half of 2021 – most likely depending on vaccination, but many push the deadline to 2022.
In Bucharest, the occupancy rate continued to be low. The average daily rate per available room (ADR) was also affected, but to a lesser extent. The average ADR between June and August decreased by 20-25% compared to the average recorded in 2019 during the same period, reaching a level of 250 RON/room/night.
“We see 2021 as a good year for market entry for new international brands or for existing ones planning network expansion, as long as the projects in question are well-located and have a sufficient number of rooms to support the business model. 2022 is expected to be the year of activity returning to some normalcy and, therefore, we see long-term players preparing the ground in this regard,” said Anca Merdescu, Associate Director Investment Services at Colliers.
The pandemic has fundamentally changed the customer experience and certain types of travel, such as summits, which may never fully return to pre-pandemic levels. As it will take some time before international business travel also recovers, local tourism will continue to play a very important role now more than ever. Operational changes, especially related to health, cleanliness, and flexibility, and the use of outdoor spaces will be at the forefront.
Frequently Asked Questions
When will the hospitality industry fully recover?
According to experts, a return to pre-pandemic activity levels for international travel is estimated no earlier than 2023.
What are the new trends in the hotel sector starting in 2021?
Trends include sustainability, green buildings, minimizing food waste, using local products, and smart devices for energy efficiency.
What major hotel projects are announced in Bucharest?
Key openings include Ibis Airport, Autograph Collection by Marriott, and projects under the Accor or Corinthia brands.