According to the latest analysis by the international advisory agency Cushman & Wakefield, demand in the hotel market in Warsaw has returned to pre-pandemic levels in the first half of 2024, the only capital city from the CEE-6 group to do so. Experts predict a continuous increase. Moreover, hotels operating in the Warsaw market achieved a 28% increase in RevPAR (average income per available room in EUR) and a 27% increase in ADR (average daily revenue per occupied room in EUR) in the first half of 2024, compared to the corresponding period in 2019. These higher performance indicators in Warsaw’s hotels are one of the reasons why this segment of the real estate market is once again attracting investors.
The hotel market in Warsaw recorded a significant increase in demand of approximately 17% in the first half of 2024, compared to the first half of 2019 and was the only capital among the CEE-6 countries where demand has returned to pre-pandemic levels. This rise in demand was accompanied by a 17% increase in supply.
In the first half of 2024, demand was primarily driven by domestic travelers, although there’s also an increasing number of bookings made by foreign guests. This trend also reflects the higher number of passengers at Chopin Airport, which increased by 17% year on year, and exceeded the 2019 H1 results by 13%. This increase in demand is also bolstered by the organization of concerts by foreign artists, or international sports events.
As per Oxford Economics forecasts, the number of overnights in paid accommodations in Warsaw in 2025 should be 31% higher compared to 2019, mainly fueled by the continued increase in local overnight stays.
Among the development plans in the hotel industry in Warsaw are the opening of Puro Warszawa Canaletta and Flaner Hotel WorldHotels Crafted Collection Warsaw in 2024, Moxy Centrum Warsaw in 2025, the expansion of Leonardo Royal Hotel Warsaw, the start of operations of Campanile & Premiere Classe Warsaw Okęcie and Canopy by Hilton Warsaw in 2026.
Despite the volume of transactions in the hotel market in Warsaw dropping in the first half of 2024, the outlook for the coming months is positive. Numerous significant transactions are in various stages of finalization, which should result in higher investment volumes, with several expected to close within the year. This demonstrates that hotels are re-attracting the attention of investors.
Warsaw’s hotel market recorded the highest occupancy among the six Central and Eastern European capitals analyzed in the first half of 2024. The outlook for the hotel transaction market in Poland, including Warsaw, over the next 12 months is positive given the number of available rooms and projects in the pipeline. Despite rising capitalization rates in 2023, this impact was reduced by increasing revenues. This, together with stable inflation, increased investor appetite, and moderate interest rates, set the stage for future capitalization rate stabilization and potential compression for hotels in prime locations.
Source: https://managerplus.pl/warszawski-rynek-hotelowy-2024-rekordowy-wzrost-popytu-i-optymistyczne-prognozy-11835
