A warm welcome to this latest edition of the Poland Hotels and Chains report: in 2022 hotel chains represent 18% of hotels but almost 50% of all bedrooms.

The Majority of international chain hotels are properties with over 100 rooms, while domestic chain hotels have a greater variety of sizes.

Over the last 20 years or so, branded hotel products have started to become more and more prevalent in Europe and the Middle East. We are still nowhere near North America when it comes to brand penetration, but the industry has been moving in that direction.

In many ways, 2022 saw an extraordinary recovery. RevPAR levels in many destinations reached pre-19 numbers, and for the first time in a very long time, a significant amount of this was driven by increases in room rates.

Hoteliers for many years have responded to any kind of crisis with a drop in rates, but this time it was different. A combination of incredible pent-up demand, supply that was not open, or fully open and a series of large-scale events saw travel through go through the roof. Rarely have we seen such a surge in rates, so clearly the industry is back.

And yet, some nagging doubts remain. There is a school of thought that 2022 represents a one off, a singular coming together of market conditions that are unlikely to be repeated. 2022 could well be a unique, ‘extra holiday’ year. So many trips had been purchased and deferred from 20 and 21, travellers thought a second holiday only counted as one because the first was already paid for.

Additionally, with hotels lacking staff across the board, especially in higher end properties, the value proposition has been tested to its limits. Big rates mean exceptional services and experiences which is hard to justify if room service is a three hour wait and the spa is closed.

The headwinds in 2023 are eye watering as well. In addition to the inability to find enough staff, hoteliers have to deal with giant increases in energy costs. In fact, with inflation running rampant, costs across the board, especially food costs, are seriously impacting the bottom line. It costs more to get to the hotel as well and as households are starting to feel the cost-of-living crisis, they far less likely to splash out on trips. 2023 doesn’t look nearly as bullish as the ’22 numbers would indicate.

Which leads back to our report. There are now over 1,200 brands vying for places within the European hotel market. Even though serious fractures started appearing in the relationship between brands and their owners.

During the long dark months of Covid, will owners put that to one side and look for the perceived safe haven of a brand, or will they continue to take the risk of filling their hotels on their own shoulders?

As always, we let the numbers speak for themselves and the spread of branded hotels continues at a steady pace. Are there too many brands? Well, the market will decide for itself, but it seems like not all of them can survive what’s coming.

Dariusz Futoma dfutoma@horwathhtl.com

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