According to STR Global data, Warsaw ranks tenth among key European hotel markets for RevPAR [1] growth in 2023 relative to 2019. Last year, RevPAR for Warsaw hotels experienced an increase of 21% year-on-year and was also above the 2019 level by 26%. The situation on the Warsaw hotel market effectively illustrates market sentiment across the whole country. According to Cushman & Wakefield, Poland is the top CEE-6 [2] country for RevPAR growth in 2023 compared to 2019.
With an approximately 55% increase, Rome tops the league table of the top 10 European markets for the average RevPAR growth (in EUR) in 2023 compared to 2019. It is followed by Paris (53%) and Edinburgh (nearly 48%). Warsaw took tenth spot, just under 3 pp behind Zurich in ninth place.
In 2023, the average RevPAR growth on the Warsaw hotel market was largely driven by higher occupancy levels compared to 2019. It is worth noting that Warsaw, Vilnius and Edinburgh are the only main European markets reporting growth which was powered by rising international and domestic demand. Analysis of HotStats data shows that in 2023 Warsaw hotels experienced an increase in leisure demand with the number of nights per available room 20% above 2019’s level. In addition, revenue per available room generated by leisure demand was 35% above the pre-pandemic level,”
comments Maciej Prończuk, Consultant CEE & SEE, Hospitality Expert, Cushman & Wakefield.
The 2023 RevPAR growth in Warsaw was also driven by an average ADR increase of 25% in the euro relative to 2019.
Hotel managers are taking measures to increase their ADR to minimize the negative impact of rising operational costs which are a major challenge facing the real estate market. ADR growth was also fuelled by changing hotel demand. There was a marked increase in the percentage share of individual leisure guests who usually pay higher room rates. A similar trend in ADR growth was seen throughout Poland. As a result, RevPAR for the whole country increased by over 21% year-on-year in 2023 and was 18% above the 2019 level. This marks the strongest RevPAR growth compared to 2019 among all the CEE-6 countries,”
adds Maciej Prończuk.
Maciej Prończuk also notes that further recovery on the Polish hotel market will also largely depend on growth in business trips. While Oxford Economics expect business demand in Poland to bounce back to 2019’s level in 2027, there are many signs that this might be notably earlier.
For instance, Warsaw hotels have already reported an increase in corporate demand. HotStats data shows that although the number of nights (per available room) driven by such demand in 2023 was 16% lower than in 2019, it rose by over 12% year-on-year. RevPAR generated by business demand in Warsaw in 2023 was on par with the 2019 level. Conference demand is another bright spot with the number of nights (per available room) in 2023 up by 25% year-on-year and despite this figure being 9% lower than in 2019, RevPAR for this category increased by nearly 13%,”
concludes Maciej Prończuk.
