EMEA Office Fit Out Cost Guide 2024
Bucharest, August 2023: The Bucharest hotel market continues to receive attention from hotel operators to expand their networks in Central and Eastern Europe (CEE). Bucharest is the 5th most attractive market out of 20 cities in CEE-12 in terms of the interest of the main operators to invest in new hotel facilities in the next period.
Cushman & Wakefield, a leading global real estate services company, conducted the Hotel Operator Beat Survey in H1 2023. Completed by more than 26 senior executives representing hotel operators with an existing presence in the CEE-12 region or interest to enter the region, they operate more than 450 hotels with over 72,000 rooms in CEE-12, and over 140 proposed hotels comprising more than 22,000 rooms in the pipeline, combined.
The most attractive markets for operators are Budapest, Prague, Warsaw, Cracow and Bucharest.
Bucharest remains a priority destination for operators that want to establish or grow their market presence in Romania’s capital. In contrast, Cluj-Napoca received moderate interest, while some surveyed operators indicated a specific focus on prime locations within the city for their business ventures.
Sevda Cadir, Senior Hospitality Consultant CEE & SEE at Cushman & Wakefield: ”Bucharest’s hotel market is attracting significant attention from international operators aiming to strengthen their foothold or expand their market share. The city’s robust recovery and growing appeal present an exciting opportunity to diversify the product and introduce more affordable luxury hotels, filling a gap that currently exists. Additionally, the Romanian coastline’s low brand penetration attracts operators due to its promising potential and lucrative market.”
Bucharest’s hotel market surged in H1 2023, with RevPAR up over 43% compared to H1 2022. Despite challenges, the sector matched pre-pandemic levels from H1 2019, driven by a nearly 11% ADR increase (vs H1 2019) or a 27% rise compared to H1 2022. Occupancy rates also rebounded by about 13% in H1 2023 vs H1 2022. Improved hotel quality, including renovations and new luxury options, along with midscale to upscale additions from Marriott, Accor, and local players, fueled this success.
Operators express positive sentiments about the future performance of hotels in Bucharest, particularly for the Luxury and Upper-Upscale classes, with 71% and 82% of respondents being optimistic or very optimistic, respectively. Regarding hotel types, extended stay and urban hotels are perceived to have the most optimistic outlook, according to 79% and 75% of surveyed operators, respectively.
The overall data suggests that the hospitality industry in the CEE-12 region is experiencing a healthy recovery. Despite the macro-economic and geopolitical challenges, there is a solid foundation for optimism and operators are keen to expand across multiple markets within the CEE-12 region. However, there are also challenges, with around 28% of hotel projects in the pipeline facing delays or being put on hold, mainly due to the increased development costs.
Cushman & Wakefield Echinox is a leading real estate company on the local market and the exclusive affiliate of Cushman & Wakefield in Romania, owned and operated independently, with a team of over 80 professionals and collaborators offering a full range of services to investors, developers, owners and tenants.
Cushman & Wakefield, one of the global leaders in commercial real estate services, with 52,000 employees in over 60 countries and $ 10.1 billion in revenue, provides asset and investment management consulting services, capital markets, leasing, properties administration, tenant representation. For more information, visit www.cushmanwakefield.com
