Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting cushmanwakefield.com to read:%0A%0A {0} %0A%0A {1}

Thanks to the summer season, Prague’s hotels are no longer the last in Europe

08/11/2021

The situation however remains difficult and the uncertainty about the winter season is growing

Occupancy rates in Prague’s hotels were 50 per cent higher during the summer holidays this year in comparison with last July and August, propelling Prague upwards in the European cities’ chart. Room rates exceeded EUR 64 in the summer, also an improvement over last year. Many hotels worked with an operating profit and the growing number of reservations is also a positive sign. Autumn traditionally brings a drop in tourism and thus in performance – September occupancy rates are still comparable with summer rates and prices are even higher, but there are concerns about another wave of the pandemic and the potential operating restrictions. However, the improved performance in the summer has confirmed again that Prague’s hospitality market has been consistently sought after and popular, and its performance is hindered mostly by external and temporary factors.

Occupancy rates at 50% of pre-crisis levels

The summer season brought an upturn to Prague’s hotels: according to STR figures, the occupancy rate in open hotels in Prague was 32 per cent in July and 44 per cent in August. These figures do not yet come close to the levels achieved before the coronavirus crisis – the occupancy rate was twice as high at 88 per cent in August 2019. Still, this year’s figure represents an approximately 50% increase over last year when the occupancy rate was 22% in July and 28% in August.

Thanks to the relatively favourable summer season this year, Prague has left the lowest position on the chart of the 35 premier hospitality markets in European metropolises that it had occupied until the beginning of the summer holidays. The Czech capital has still a long way to go before placing among the best-performing markets again, but it came 28th in July and 23rd in August, outperforming Amsterdam, Sofia and Rome.

Bořivoj Vokřínek, Partner, Strategic Advisory, Head of Hospitality Research EMEA, Cushman & Wakefield: “The summer season brought a relatively quick increase in demand, which is a very good trend, but more than one half of room capacity in Prague remained vacant. It has to be said, though, that many hotels achieved occupancy rates much higher than Prague’s average – with some exceeding 70 per cent –thanks to a good location, proactive marketing and pricing strategy and, in certain cases, film crews that were making films in Prague during the holidays.”

Prices at 75% of the pre-crisis year

According to STR figures, 87 per cent of hotel capacity was open in Prague in August, slightly below the European average of 92 per cent.

The average room rate in Prague this August was EUR 64, which is 8.3 per cent more than in the same month last year, yet it is still 25.7 per cent less than EUR 87 in August 2019.

The improved performance indicators allowed most local hotels to overcome the critical point and operate with positive gross operating profits. According to HotStats data, the profitability of the hotels that submit their figures to HotStats reached approximately 23% and EUR 16 per available room in the last three months.

Uncertain autumn

Bořivoj Vokřínek, Partner, Strategic Advisory, Head of Hospitality Research EMEA, Cushman & Wakefield: “Unfortunately, we should expect the performance of Prague’s hotels to drop again from September on. The reason is the traditionally lower demand on the part of leisure travel and quite slow recovery of corporate clients and conference tourism to date.”

The occupancy rate was 42 per cent in September, which is a very good result in the context of this year, but it pushes Prague back down on the European chart – to the 29th position – which is still ahead of Sofia, Brussels and Lisbon. Compared with August, the room rate has even grown to EUR 74, a 29% increase over last year. This is a good trend, even though this is still about 28 per cent lower than 2019 prices.

Reservation figures provided by the SiteMinder web portal show yet another positive trend: Prague is achieving higher figures than the European average and the data from the key neighbouring markets. While the rate of reservations in Prague stood at 108 per cent on 23 October compared with the same period of 2019, Berlin posted 88 per cent and Vienna 77 per cent.

Time to address financing

Neither the positive results of hotels during the past three months nor any favourable future developments guarantee that all hotels will successfully tackle the problems that the coronavirus crisis has brought them. Some face or will face financial problems, and it is the high time to address those right now.

Bořivoj Vokřínek, Partner, Strategic Advisory, Head of Hospitality Research EMEA, Cushman & Wakefield: “Our recent research shows that more than a half of hotel owners in the CEE region will have to refinance within two years. The accessibility of financing is improving, but banks can be expected to remain more prudent in the mid-term perspective and offer lower LTV (loan to value) ratios than they did before the crisis. That can cause serious problems and call for more capital on the part of the owners, which – following a year and a half of decreases and losses – may be hard to find for many hoteliers. As a result, some owners will have to quickly find alternative capital sources or consider selling their assets. There are various ways to solve this problem, but it is crucial to start acting as soon as possible because steps of such vital significance should not be taken under pressure.”


Media Contact

Michaela Sedlbauerov
Michaela Šedlbauerová

Head of Marketing Czech Republic • Prague

Related News

Cushman & Wakefield office, reception, Quadrio, armchair
Companies rather renegotiate than relocate

The cost of fitting out new offices is one of the factors companies consider when deciding whether to stay in their existing premises or move to new ones. 

11/04/2024

Industrial map, Czech Republic
Has the Czech industrial property market reached its peak?

The Czech industrial market‘s development slowed down to some extent last year after years of growth, but it is rather returning to normal after the record activity of 2021 and 2022.

20/03/2024

travel, mountain, woman, forrest
Hotel Investment in CEE

Cushman & Wakefield and CMS present the key findings from the fourth edition of their joint report on the hotel investment scene in CEE: Getting Real about ESG in Hotel Real Estate.

25/10/2023

Operator Beat map
Prague hotels 2021: Better results than in the preceding year but still behind 2019, investors and operators remain interested

Whereas the European average according to STR data exceeded 43%, only 26% of hotel capacity that was operational in Prague was occupied.

02/02/2022

Hotel, signage
Prague’s hotels are still performing low, yet investors’ interest in them continues

The occupancy level in Prague’s hotels was just 10 per cent during the first six months of this year. Investors’ interest in buying remains strong according to Cushman & Wakefield’s current Hotel Investor Beat survey. 

17/08/2021

Operator map, CEE SEE
Prague Hotels: Decline in 2020, Potential in the Long Run

The latest STR figures show that the Prague hotel market has borne the brunt of the coronavirus crisis in Europe.

27/01/2021

Related Insights

Cover, woman in a meeting room
Insights • Economy

5-minute Real Estate Market Snapshot

Explore our 5-minute Real Estate Market Snapshot, a video overview of the commercial real estate market developments presenting the key trends in real estate investment, logistics, office and retail sectors.

25/03/2024
Office Fit Out Cost Guide - Web card
Research • Workplace

EMEA Office Fit Out Cost Guide - Czech Republic

Discover the essential data for planning and budgeting your office transformation in the Czech Republic with our Office Fit Out Cost Guide 2024. Begin optimizing your workspace in key cities like Prague today!
Thomas Moore • 20/03/2024
office buildings
Insights

Complete Asset Optimisation Guide

Discover expert strategies for optimising logistics, retail, and office real estate assets. Gain insights to maximise returns and improve performance.
Andie Penman • 29/02/2024
Market Outlook
Insights

CEE Investment Market Outlook 2024

CEE investment Market Outlook 2024 analyse commercial real estate in Czech Republic, Hungary, Slovakia, Poland, Romania and Bulgaria.
12/02/2024
Czech Republic, Prague, Old Town Square, High Street
MarketBeat

Czech Republic MarketBeat

Cushman & Wakefield MarketBeat reports analyse quarterly Czech Republic commercial property activity across office, retail, industrial and hotel real estate sectors including supply, demand and pricing trends at the market and submarket levels.
Kamila Breen • 31/01/2024
main streets across the world 2023
Research

Main Streets Across the World 2023

In this 33rd edition of Main Streets Across the World, we’ll explore the near-term outlook for the retail sector; headline rent and ranking changes for best-in-class urban locations across the world; key indicators and global main street rankings; and key trends to watch such as the cost-of-living crunch, e-commerce and more.
21/11/2023
Women Hotel City
Insights • Investment / Capital Markets

The Hotel Investment Scene in CEE

Welcome to our fourth edition of the joint Cushman & Wakefield–CMS report on the Hotel Investment scene in CEE: Getting Real about ESG in Hotel Real Estate
Bořivoj Vokřínek • 25/10/2023
City, graph
Insights • Investment / Capital Markets

Investment Highlights

In the first half of 2023, volume of transactions in the property sector within CEE-5 surpassed EUR 2 billion, which is 59% less than in H1 2022.
Jeff Alson • 02/10/2023
office, statistics, laptop
MarketBeat • Economy

CEE MarketBeats

Cushman & Wakefield MarketBeat reports analyse quarterly commercial real estate activity in the CEE region (Czech Republic, Hungary, Poland, Romania, and Slovakia) across office, retail, industrial and hospitality real estate sectors including supply, demand and pricing trends at the market and submarket levels.
Marie Baláčová • 13/09/2023
Prague, Czech Republic
Research • Economy

Czech Real Estate Market View

A regular update on the commercial real estate market in Czech Republic.
Marie Baláčová • 27/04/2023

CAN'T FIND WHAT YOU'RE LOOKING FOR?

Get in touch with one of our professionals.
With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Cookies
MORE OPTIONS
Agree and Close
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All
Save settings