Colliers Market Report Denmark 2023

Hotel - Colliers Market Report 2023

104

2022 set for new record high but high inflationmay stunt the market in the short term

The fact that the hotel market is getting back on track is clearly reflected in forecasts for 2022. Already in November, national bednight figures outperformed those reported for 2019, the previous record-breaking year. Nevertheless, record-high inflation rates soon put an end to the respite and prosperity experienced in the hotel market, dealing the industry a severe blow. Mainly ris ing energy prices have impacted revenues, albeit several hotels have tried to recapture losses by means of energy surcharges and other measures. So far, however, the effect is believed to be short-lived, with the strong under lying demand expected to drive the market forward in the years ahead. Domestic tourism drives current momentum Themain driver of the recovery in hotel activity is growth in domestic tourism. As the pandemic unfolded, an increas ing number of Danes opted for staycation. This trend has continued even if most of the world has reopened, allow ing for renewed travels to many destinations.

Improved possibilities of restriction-free travel abroad could well usher in a renewed interest in outbound tourism, with Danes increasingly discarding staycations. On the other hand, with sustainability and carbon foot print becoming a weighty concern among many Danes, air travel is likely to be more frequently discarded in favour of staycation destinations that can be reached by train, bus or car. However, the new trends in all probability spring mostly from general uncertainty as the year has been marked by rising petrol prices, chaotic scenes being played out in several European airports, price hikes and general eco nomic uncertainty. Although domestic tourists are at this point dominating the hotel market to a larger extent than before, the market will highly likely return to the his torical predominance of foreign hotel guests in the long term. This is a particularly welcome trend, all the while foreign tourists have a higher daily spend than domestic tourists on city breaks in Denmark (source: 24-hour tour ist spend, VisitDenmark 2018).

Domestic tourists driving recovery in bednights in 2022

14

12

10

8

6

4

2

0

13 Domestic

14

15

16

17

18

19

20

21

22

Foreign

Note: Annual number of bednights (million), hotels in Denmark, by origins of hotel guests. Source : Statistics Denmark, Colliers