In a context of uncertainty and a sharp decline in the volume of investment in 2022, hospitality has proved to be, along with retail, one of the most resilient sectors throughout 2023. In fact, hospitality is expected to account for the largest share of the total amount invested in Portugal this year, with an estimated volume of over 600 million euros.
Among the main transactions, stands out the Dom Pedro hotel portfolio for 250 million euros, Minor International’s hotel portfolio for around 130 million euros and Pestana Vila Sol for 37 million euros.
Following the rapid recovery in tourism demand levels in 2021, the hotel industry has seen an excellent performance in the main performance indicators that legitimize and boost the sector’s attractiveness.
Indeed, tourism in Portugal continued to break records, with the number of arrivals surpassing the 29 million mark in 2019.
On the other hand, while in 2021 the occupancy rate in most regions was still below pre-pandemic levels, in 2023 hospitality has managed to consolidate demand levels without affecting the growth in average revenue per room.
In fact, the average revenue per room (RevPAR) in Lisbon is expected to be around 20% higher than pre-pandemic values. This dynamic is not confined to the capital, as the city of Porto showed an occupancy rate of around 7% above 2019 levels by last September and an even more significant growth in RevPAR, that is 50% above pre-pandemic values.
The excellent operational performance of tourism has driven continued investment in new hotels across the country, with 53 openings in 2023, representing an increase of almost 3,000 rooms. The regions of Lisbon and the North accounted for more than half of the new hotel supply and almost half of the new accommodation units are four-star hotels.
Next year we may see a stabilization of demand levels as a result of the impact of the global financial context on families’ disposable income for tourism and leisure, an impact that may be attenuated in 2023 due to the World Youth Days and the subsistence of so-called ‘revenge tourism’.
Even so, there are no signs of a slowdown in investment in new hotels over the next few years, with around 60 openings planned between now and 2024, with the four-star segment continuing to dominate. Among the most eagerly awaited openings are Amorim Luxury’s first hotel (JNCQuoi House), the debut of the Andaz brand (Accor Group) in Portugal and the entry of The Standard brand in Lisbon with the Palácio Santa Clara.
Opinion article by Catarina Branco, Consultant, published in Revista Hotelaria, online and in print versions (Theme: Openings and Renovations) on January 30, 2024.