Edinburgh, Glasgow and Manchester are among the European cities best positioned for recovery in the hotels market, according to the latest research from CBRE.
The report showed that markets with “material exposure” to leisure demand, and a lower reliance on both international travel and demand for meetings, incentives, conferences and exhibition space, are best positioned for a more rapid recovery.
Traditionally Germany, the UK and Italy account for the highest share of domestic tourism spend, which positions each country for a more immediate recovery.
Cities including Paris, Vienna, Madrid, Barcelona and Berlin have been heavily exposed to the postponement and cancellation of large meetings and events.
However, CBRE said these cities are well positioned to capitalise on recovery in this segment in the long term, given the amount of conference and exhibition space, infrastructure and connectivity available in each.
Domestic travel will be the first to see a return of activity. International travel demand will take longer to return, with accommodation providers in gateway cities and airport locations among those most exposed to the limited volume of international travel demand.
Leisure travel is likely to see an immediate surge in demand, particularly staycations. Countryside and rural hotels across Europe are expected to benefit from this trend first, since travellers will initially seek to avoid densely populated locations.
While corporate travel will return as economic activity resumes, CBRE expects this will be limited and to remain below “normal” levels for the short-to-medium term. Companies will look to recover their financial position before increasing travel expenditure.
Joe Stather, associate director of hotels at CBRE, said: “Previous demand shocks in the hotel market show us that not all customer segments are impacted to the same degree, or indeed follow the same trajectory in terms of recovery.
“We anticipate that markets across Europe which have previously benefitted from strong domestic leisure demand are well positioned to lead the recovery cycle.”
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