MNCHEN (dpa-AFX) – Regardless of the dramatic drop in the number of guests, numerous hotels are still being planned and built in Germany. The feared large flight of investors from the hotel industry has not materialized. According to analyzes by market researchers and real estate agents, there have also been no major emergency sales. Although many city hotels in particular are missing guests this year, the signs in the hotel industry, which has been hard hit by the pandemic, are pointing to recovery. According to experts, some holiday hotels in holiday regions were even better utilized this year than before the crisis. The future of the hotel industry is a topic of the Munich real estate fair Expo Real, which opens its doors this Monday.
In January 2020, 718 hotel projects were planned or under construction in Germany, as the hotel consulting company of the real estate broker Engel & Vlkers found. “At the beginning of the pandemic there was a brief stagnation because the banks were very cautious about financing for a few months,” says managing director Andreas Ewald. According to the company’s hotel market report, 75 of these projects were finally buried and 64 others were put on hold.
But 216 houses have now been opened, and 363 more are still in progress. “There is still a lot of liquidity going on in the real estate market,” says Ewald. “We can see that many projects are picking up speed again.” The situation is not rosy: “The mood in the hotel industry is brightening up again, although demand has not increased to the extent that it should be.”
State support helped a lot. “In Spain, the pressure on the property side was much greater,” says Ewald. “There was hardly any government aid.”
From reunification until the beginning of 2020, the accommodation industry in Germany was on a virtually uninterrupted growth path, accompanied by far-reaching structural change. Small and medium-sized family businesses – boarding houses as well as rural inns – closed by the thousands. To this end, new and larger chain hotels were constantly being built in the cities.
In 1992 the Federal Statistical Office counted 318 million overnight stays in Germany. In 2019 it was 495 million. In 2020 there was a dramatic slump: the number of overnight stays fell to 302 million – less than three decades earlier.
But the number of places to sleep almost doubled in the same period: from 2 to 3.8 million. Most noticeable is the development in Berlin. In the capital, the number of beds has almost quadrupled since 1992 from 41,950 to over 150,346.
Internationally, things are already looking up again this year. The world’s largest chain Intercontinental, which includes around 1250 Holiday Inns around the world, reported an operating profit of 138 million dollars for the first half of the year. But it will probably take years before the crisis is finally overcome. In Germany, the IHA hotel association assumes in a report published in June that the pre-crisis level may not be reached again until 2025.
Because even if all hotels suffered from the months-long lockdowns, there are crisis winners. “You have to see the situation in a differentiated way,” says Ewald. “The leisure hotel industry profited greatly from the crisis. In some cases, sales were higher than before the pandemic.” The situation is difficult for business travel or conference hotels. “I think there are hotels that will take a long time to get back to pre-crisis levels.”
On the outskirts of many large cities, there are hotels that specialize exclusively in business travelers: concrete boxes in commercial areas. Such hostels are pretty empty again this year.
Hotel managers and investors alike hope that the pandemic is just a deep dent, not a permanent kink. Hotel construction is part of the real estate boom, which is being fueled by the European Central Bank’s zero interest rate policy. “A lot of money is still desperately looking for investment opportunities,” says Stephan Kippes, market researcher at the real estate association IVD Sd. “That goes from the fund to the family office to the well-to-do private citizen.”
Over the course of the year, the number of overnight stays has risen significantly again. Bavaria is still the number 1 tourist destination. In August, the State Statistical Office counted 11.4 million overnight stays. That was almost as many as before the crisis, although the previously numerous guests from the USA, China, Japan and Arab countries were absent.
“The numbers are going up again,” says Kippes. “If the international travel restrictions fall, there will be dynamism again.” A positive sign for the hotel industry: “You don’t hear much from opportunists.” This means investors who get into troubled companies cheaply.
The hotels in which business is up again now have another problem: a lack of staff. Many former employees have looked for new jobs. “Above all, there are a lot of temporary workers,” says Thomas Geppert, managing director of the Dehoga hotel and restaurant association in Bavaria. “We are extremely labor-intensive. The hospitality industry needs about six times as many employees as the retail trade to generate the same turnover.” But the hotel operators rely on the same principle as the investors: “We hope that it will get better,” says Geppert./cho/DP/nas
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