Hotel industry to fare better in 2011?

2010-04-13



Companies operating in the European hotel industry believe that the market climate will not improve before next year, according to a survey conducted by DLA Piper as cited by Puls Biznesu.
From among representatives of 417 European hotels, only 2% expects the market to improve in 2010. Meanwhile, a year earlier as much as 37% felt the sector would see growth in 2010. Last year brought the hotel market to a halt as difficulties in raising financing forced firms to postpone or fully resign from the construction of new facilities. This year will not be very different, though market participants expect greater activity on part of market players in the next 12 months – 80% of respondents is convinced that the largest hotel chains will in 2010 focus on taking over and on transforming smaller chains, and 66% that the market share of large hotel chains will grow in 2010. In the opinion of respondents, in the coming three years, hotel chains are likely to eye with interest the markets of China and India – around 28% of respondents see China as a market with great prospects for the hotel industry, while 24% holds such an opinion about India.
According to the persons who took part in the survey, prices of hotel services will return to their pre-crisis levels no sooner than 2012, and as a consequence chains are increasingly deciding to build smaller economy class facilities which are very popular among clients. In Poland, because of the upcoming Euro 2012 championships, investors appear to be slightly more optimistic, though the situation here will not be very different from the global one as hotels will not build their development strategies only around one sports event.

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