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Europe Hotel Operator Beat H1 2023

Bořivoj Vokřínek • 06/06/2023

This is an ongoing survey which started on the 21st of April 2023. 

As of 5th May, the survey was completed by 125 executives representing over 78 operators with existing presence in Europe or interest to enter the region.

The interviewed operators represent over 5,192 hotels with over 567,000 rooms already operating in Europe, with an additional 919 proposed hotels comprising over 125,000 rooms in the pipeline.

Europe Hotel Operator Beat H1 2023 outlook chart

Despite the current economic and geopolitical headwinds, operators are keen to expand in Europe and remain optimistic about the performance outlook of the hospitality sector.

The preliminary results of our H1 2023 Operator Beat sentiment survey across Europe underlined keys trends for the hotel industry:

 

PERFORMANCE OUTLOOK

Luxury hotels and Resorts are considered to have the best outlook, with 89% and 86% of surveyed operators being optimistic or very optimistic about these two hotel types, respectively.

CONTRACT TERMS TRENDS

53% of surveyed operators report an increasing trend of Pandemic Clause in their new contracts and renewals in the last 12 months. ESG KPIs Reporting Clause is also being increasingly included in contracts according to 50% of surveyed operators.

WILLINGNESS TO OFFER LEASE

Since last year, hybrid and variable leases have been increasingly offered by 35% and 28% of the surveyed operators, respectively. On the other hand, 19% of surveyed operators are offering fewer or have stopped offering fixed leases.

HOTEL PIPELINE TRENDS

Approximately 16% of the pipeline projects are currently delayed, while 8% are on hold. 6-12 months is the most common delay of pipeline projects (according to 40% of respondents). Not surprisingly, 63% of issues associated with delayed/pending pipeline projects are due to rising development costs, followed by debt funding issues and economic uncertainty.

ENVIRONMENTAL CONSIDERATIONS

Surveyed operators are likely to offer higher rent or lower fees for hotel properties with the highest environmental building ratings/certifications, according to 66% and 51% of respondents, respectively.

Learn more about the initial findings by downloading the report.

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