Vienna Hotel Market - Promising Prospects For Another Success Story

Tourist demand in Vienna experienced a significant recovery. While international travel restrictions still had a diminishing effect on tourist demand in the Vienna hotel market in the first half of 2022, there were clear signs of improvement in the second half of the year. A market report by hotel specialist Christie & Co provides insights into supply and demand, and shows which hotel categories have come through the crisis best.

According to Vienna Tourist Board, Vienna recorded a total of 13.2 million overnight stays in 2022 as a whole, which is about 75% of the record demand in 2019 (17.6 million overnight stays) . A positive trend was observed especially in the second half of 2022. The total of 8.2 million overnight stays in the second half of the year was only 1.4 million below those of 2019, a gap that could now be closed even faster with the lifting of travel restrictions in China, the fastest growing origin market until the outbreak of the pandemic.

Encouragingly, the average length of stay increased from 2.23 days (2019) to 2.36 days (2022), with a simultaneous return of international travellers. While 37% of arrivals in 2022 were domestic, 63% were international, of which 27% were from Germany. The United States ranked third (8%), followed by Italy (6%) and Spain (5%).

Those source markets with the most overnight stays and arrivals spent comparatively little on overnight stays. The frontrunners in this respect were the United Arab Emirates and the USA, where guests spent an average of €97.8 and €92.5 per person per night on overnight stays, respectively.

Even though the year-round occupancy rate of 58.7% was still 21.5 percentage points behind that of 2019, Viennese hoteliers were able to increase the average room rate by 18.2% to €109.2. The report paid particular attention to the revenue per available room (RevPAR), divided among the different categories. Interestingly, luxury and budget hotels already increased their revenue per available room in the second half of the year compared to the same period in 2019. The 5* hotels recorded an increase of 19.9%, the 1* & 2* hotels were 11.3% above 2019. The 3* and 4* categories still recorded a minus of 8.6%, respectively 3.5% compared to 2019. When translated to the overall market, the RevPAR reached a new all-time high of 102.3€ in December 2022.

New luxury hotels, such as Rosewood, which opened in August 2022, appear to be having a positive impact on Vienna's appeal as a quality destination. It will be exciting to see if the rate increase in the luxury segment can be continued with the reopening of The Amauris (formerly The Ring Hotel) and the opening of the Almanac Vienna, scheduled for mid-March. Manuel Strasser, Consultant Investment & Letting.

Vienna's outstanding reputation and the fact that Viennese hoteliers invested diligently in their products during the pandemic years are indicators that Viennese tourism will continue to write its success story again and that new record figures can be expected soon. Simon Kronberger, Director Austria & CEE