![News Article C&W Czech Republic Hotels Prague](https://cdn.property-forum.eu//image/articles/17987/1500/prague_hotel_art_deco_imperial-852.jpg)
For a time, the Prague hotel market has lagged behind other European cities in terms of recovery from the impacts of the COVID-19 pandemic. Its latest performance indicators are showing a significant increase in 2023, Cushman & Wakefield reports.
RevPAR ended 10% above the level recorded pre-covid in 2019, in December 2023 as much as 35% above December 2019. Occupancy reached 71% last year, in December 2023 returning to the level of December 2019 with 79%. The average daily rate was €110 in 2023, 22% higher than the year before. The investment transactions volume grew by 68% year on year, reaching €137 million, and additional major deals are planned for 2024. The Prague hotel market proves its resilience and attractiveness.
Its year-on-year growth of RevPAR was the second highest among the cities compared – while the European average amounted to 16%, in Prague, it was 36%. This was partially due to the city’s low starting base. Reaching €78 in 2023, Prague’s RevPAR was ahead of Warsaw and Bucharest.
Sevda Cadir, Senior Hospitality Consultant, CEE & SEE, Cushman & Wakefield says: “The increase in RevPAR was primarily driven by ADR growth, supported by strong leisure demand, limited hotel supply, and proximity to key source markets; and a notable 20% rise in occupancy in 2023 vs. 2022. Despite operational challenges leading to increasing costs, the revenues allowed Prague full-service branded properties to record an average gross operational profit margin at 43% of total revenue, ranking 3rd highest within the major European markets, and outperforming the key CEE capitals and Vienna.”
Limited airport activity had been a bottleneck to tourism in Prague for a long time – however, over 30 routes resumed operations in 2023, with additional lines expected to open in 2024. Passenger numbers should grow to 15.5 million this year, a 12% increase vs. 2023, and only 13% below 2019.
David Nath, Head of Hospitality, CEE & SEE, Cushman & Wakefield: ”Improved airport connections, especially with key Asian markets like Taiwan and South Korea, led to a 63% surge in Asian tourists compared to 2022. Additionally, Prague benefits from a luxury supply influx brought by hotels such as the Andaz or Almanac X. The upcoming opening of W Prague and Fairmont Golden Prague will further elevate the country’s hotel average daily rates.”
Hotel transaction volumes reached €137 million in 2023. While still significantly below the levels achieved in the record year of 2019, it is an increase of two-thirds compared to 2022. In 2023, 9 hotels were transacted, with 78% of the volume directed to Prague, and 84% into the luxury and upscale categories. While in the past domestic investors had prevailed, last year 77% of the volume was transacted by pan-European and Asian investors. This illustrates that the Czech hotel market is reopening and attracting international capital.