In Central and Eastern Europe, hotel owners are experiencing record months in terms of average daily rates which was the primary driver of the double-digit RevPAR (Revenue per available room) growth recorded by central European cities in 2017. The growing trend was also seen in the first half of this year (H1 2018). The only exception was Warsaw where RevPAR dropped slightly due to declining occupancy, yet the prices of rooms increased as in other capitals. The higher room rates translated to notable gains in hotels’ profitability which brought significant interests from investors. The lack of hotel properties available for sale and shortage of development sites in prime locations is turning attention to conversions of existing buildings into hotels. As the demand continues to grow and the development pipeline remains limited in most markets (except for Warsaw and Vienna), profitability is expected to stay strong also in the coming years.
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