The Russian hotel industry is becoming increasingly optimistic following the challenging economic situation the country has recently faced, according to Bench Events.
On the one hand, there has been a dramatic decrease in demand from foreign tourists alongside increased expenses which has had an impact on operating costs, but on the other hand the increase in domestic travel has, in the short term, compensated with a positive impact on the hotel occupancy rates.
A combination of the economy becoming more stable, growth of tourist Inflows, both domestic and from Asia, and the Confederations Cup 2017 and forthcoming FIFA World Cup 2018, has provided new opportunities and renewed interest from investors and international hotel chains.
Russian hoteliers are also investing in upgrading existing hotels and improving standards to meet consumers’ expectations.
According to STR, as of May 2017 the hotel pipeline in Russia is looking positively healthy with an additional 8,061 rooms over 42 projects.
According to a recent news release from JLL, 2016 was a year to remember for the two Russian capitals.
For the first time since recording hotel performance, all hotel market segments in both Moscow and St. Petersburg finished the year with year on year increases in RevPAR.
Tatiana Veller, national director and head of hotels and hospitality group at JLL, Russia & CIS, commented: “Both inbound and domestic travel is now on the rise and the hotel segment as a real estate sector, is becoming a more attractive proposition to investors as a tool for diversifying their portfolios, and a business that provides stable operational cash flows.
“Of course, there are still many obstacles on the territory of ex-USSR to hotel development, and the hot spots are shifting from larger cities to secondary locations with newly appearing drivers of demand for temporary accommodation.
“With these changes, we are thrilled to be partnering with Bench Events to bring the largest gathering of professional hotel investors back to Moscow to discuss how the industry in our region is maturing and what are some of the new trends which all players need to be aware of today.”
Bench Events will host the Russia Hotel & Tourism Investment Conference, the premier meeting for the region’s hotel and tourism investment community, on October 24th at the Radisson Blu Belorusskaya in Moscow with the support of JLL, Carlson Rezidor Hotel Group, Cushman & Wakefield and AccorHotels among other industry leaders.
The conference will be a high-level, investor-driven, invitation-only event and will bring together key players in the real estate and hotel industry: developers, investors, hotel operators, owners, advisors as well as representatives from the banking and legal sectors.
Jonathan Worsley, chairman and founder of Bench Events commented: “As well as offering engaging content and outstanding speakers, this conference will provide a valuable networking platform with over 50 investors already confirmed.
“We are excited to be returning to Moscow this year, Russia remains a huge market with so much potential for growth and investment.”