Russian hotel market. How the development of the tourist complex has changed the hotel market of the capital Hotel market

According to experts of the hotel business and tourism department of Cushman & Wakefield, the second half of 2016 will return hotels to the revenue growth zone.

Sentence

High-quality offer of Moscow hotels in the II quarter. 2016 will remain at the level of 16 thousand numbers. ( Excluding hostels, mini-hotels, as well as airport hotels).

The closure of two large hotels (Iris Congress and Belgrade) at the beginning of 2016 for reconstruction immediately brought out 431 rooms from the market. Given that the former “Iris Congress” reopened in June - like the Holiday Inn Seligerskaya (although the number of rooms that fully comply with the brand’s standards is still limited to 30), the actual change in the quality hotel offer for the first half of the year was -1.4% compared to with the results at the end of 2015

The number of rooms, realistically expected to open before the end of 2016 after the opening of the updated Holiday Inn Seligerskaya, is estimated at 750 units (see the table with the announced projects), although the “net” increase in the quality of the number of rooms is much more modest - 470 units.

Subject to compliance by the builders with the schedules for completing new projects, according to the results of 2016, a high-quality hotel offer may increase by 2.9%, up to approximately 16.8 thousand rooms of various categories.

New 2016 Offer

Midscale & Economy - mid-price and economical segment

Upscale - above average price segment

Upper-Upscale - high price segment

Luxury - luxury segment

The main increase in numbers is in the Economy segment

The growth in the supply of economy standard rooms in 2016 will be 25 percent.

With a real increase in the quality offer of only 470 rooms, which is 3.4 pp. lower than the rather modest growth results of the previous period, the main growth in 2016 occurs in the Economy segment, which as of mid-2016 is 9% of the market (1.488 numbers). By the end of the year, taking into account the opening of Ibis Kievskaya (350 rooms), its share in the market structure will grow to only 10%, but the growth in the number of rooms will be as much as 25%.

Despite the planned opening of Novotel Kievskaya (250 rooms) and Adagio Kievskaya (150 rooms), the share of the Midscale segment will not change due to the fact that due to the temporary closure of 270 rooms in the former Belgrade Hotel, the net increase in this category will be only 2 % of the number of rooms.

In the absence of new finished projects of Luxury, Upper-Upscale and Upscale standards, their proportional shares in the market structure, if they decrease, will be insignificant.

The structure of the hotel offer, II quarter 2016 year

Demand

Recovery of the average price per room is becoming a trend

The timid shoots of optimism noted in the 1st quarter. years in the luxury price segment, by the middle of the year spread to more affordable hotels, which resulted in an average market growth of ADR of 8.6% compared to the same period of 2015 - up to 6.628 rubles / room.

At the same time, the Luxury segment hotels remain the main growth drivers, where prices rose by an average of 13.5%, to 14.016 rubles / room.

In the segments Upper-Upscale and Upscale, ADR growth was more modest - by 5.9% and 3.6%, respectively. In the Midscale category, growth has not yet taken place at all (less than 1%), and in Economy hotels a further reduction in prices has been noted - on average, by 6%.

Did demand recovery take place?

The recovery in demand for hotel services observed in Moscow hotels with virtually no change in the growth vector over the past 12 months, with an obvious acceleration in pace since the beginning of the 2nd quarter. year, allowed the market according to the results of the first half of the year to increase the load level by an average of 3.4 pp. (5.5%) compared with the previous period.

Not all price segments were equally benefited from an increase in the number of overnight stays sold. The largest increase (7.2 percentage points and 5.9 percentage points) was recorded in hotels of the Upscale and Midscale categories, respectively. Economy standard hotels, on the contrary, are temporarily losers - with a loss of the loading level of 1.7 pp.

In percentage terms, however, demand growth is most pronounced in the Upscale and Luxury segments - 11.9% and 9.9%, respectively.

The growth of hotel profitability gives hoteliers a reason for optimism

The recovery in demand, noted by Moscow hotels of almost all price categories since spring, allowed them to convert the unidirectional increase in the number of nights and the cost of accommodation into an increase in profitability in terms of room.

The average rate of return on an accessible number in the first half of 2016 was 4.319 rubles, which is almost 15% higher than the result of the same period of 2015.

The most impressive results were demonstrated by the Luxury standard hotels (24.7%), as well as Upscale (15.9%), while if in luxury hotels this indicator was provided by increasing the average room price, in the Upscale segment it was due exclusively to increase downloads.

The Economy segment, in which the share of the old “post-Soviet” number of rooms is still significant, continues to show negative results (-8.4% compared with the previous period), which is most likely caused by an attempt by hotels of this price category to stop the outflow of customers by reducing accommodation prices.

Trends

Great expectations for 2016 results

The confident recovery in demand noted by Moscow hotels since the end of the 1st quarter. 2016, allows the Moscow hotel industry not only to actively increase flexible rates (including tariffs in online sales systems, which today provide an impressive share of the rooms sold), but also gives rise to optimism regarding the results of the year, as the second half of the year is traditionally more productive in terms of hotel revenues.

As a result, with some possible increase in load across the market as a whole, the main driver of growth is expected to be the ADR indicator (8-10% in annual terms), which will overtake the forecasted Central Bank of the Russian Federation average annual inflation rate (5-5.5%) and will return hotels to the revenue growth zone.

The main question is whether these positive results and high rates of tariff recovery can be converted into revenue growth that exceeds the rate of inflation in 2017.

Moscow, possessing a unique cultural and historical heritage and playing a large role in the political and economic life of modern Russia, has every reason to claim the position of the largest center for business and cultural tourism not only on a national scale, but also successfully compete in the world tourism market with other capitals of Western European states .

Today, Moscow attracts two main categories of clients, which are of great importance for hotel enterprises: businessmen arriving for business purposes, and tourists with cultural and cognitive interests. Tourists coming to Moscow for cultural and educational purposes are not yet so numerous as to significantly increase the workload of hotel enterprises. Other segments of the tourism market, such as event tourism, pilgrims, students and teachers, people who come for treatment, and so on, allow hotels that find their market niche in servicing such marginal categories.

Thus, the majority of Moscow hotels compete in the segment of the business tourism market for foreigners and Russian citizens who have traveled to Moscow or arrived on business need.

The flows of foreign visitors to Moscow are tied to certain places generating this demand. These are the so-called tourist attractions, in the role of which are places of concentration of business activity, architectural monuments, theaters, places of entertainment, etc. In Moscow, the city center is the most attractive for visitors. That is why central hotels have better occupancy rates and can set higher prices for their services. They make up the highest segment of the market.

Middle market segment It is represented by secular hotels of the highest ranks and is rather ambiguous in terms of service and equipment.

Lower segment of the market represented by hotels of category 2 * and 1 *. These are mainly Soviet-built hotels of the first category, multi-hull and high-rise, located on the outskirts of Moscow, as well as hostels, transferred to the hotel.

Non-category hotels also apply to the lower segment of the market. This group is represented by facilities where in recent years no measures have been taken to improve living conditions. Hotels included in this group are the subject of attention of private investors.

Russian citizens are especially in demand with 2-star category hotels, which accounted for 59% of the accommodations. In 3-star hotels, 16% of Russians stayed, in 4-star hotels - 15% and in 5-star hotels, respectively - 1 0% russian citizens.

However, it should be noted that Moscow, as an object of tourism, today is losing the competition with other capitals of the world. The volume of services in Moscow reaches about 1 million foreign tourists annually, while for Paris this figure is 25 million tourists, and for London - 18 million.

Improvements to the tourist infrastructure and material and technical base for the main components of tourist services are needed: transport accessibility, accommodation facilities, catering facilities, sightseeing buses; level and variety of tourist services: the creation of new tourist routes, the development of congress and exhibition activities, the holding of cultural and sports events (festivals, olympiads, anniversary dates); improving the safety of tourists; improvement of the regulatory framework; improving tourist information services; improving the system of promoting tourism products on the world market; improving the training of professional personnel for the tourism industry.

With the closure of the Rossiya Hotel, there were no affordable and popular hotels in the center of the capital. Moscow hardly serves 900 thousand tourists and it is still unrealistic to talk about the expected 5 million tourists in the next few years.

Foreign guests coming to Moscow rightly complain about the hotel high cost. If earlier they could stay at the Rossiya Hotel and admire the Kremlin towers at an affordable price, now they live in Izmailovo, where they offer far from the best service for the Russian price.

In Europe and North America, a network of motels and hostels is widely developed for people with average incomes. There, for 20-25 euros, they will provide both a room and breakfast. Having a berth for such an amount, you can safely go on a trip to Paris. In Moscow, the price per day will cost more than 100 euros.

The lack of cheap hotels in Moscow is dictated by the development of the market. According to experts, the main reason for the shortage in the hotel services market in Moscow is that builders and investors who are focused on quickly earning big profits are reluctant to take on the construction of cheap hotels. The 3 * hotel segment develops later when the category of 4-5 star hotels is filled. On the other hand, middle-class hotels begin to generate income only 5-7 years after their construction.

In September 2008, the effects of the global liquidity crisis began to appear on the Russian commercial real estate market. In recent years, the capital's hotel market has developed at a rather slow pace and has been the weakest segment in the commercial real estate market. Under the influence of the crisis, growth dynamics slowed down even more, new objects began to appear on the market even less often. Moreover, most likely, under the current conditions, only high-class hotel projects will be attractive to investors. As a result, the increase in the total number of rooms in the coming years will continue to occur mainly due to hotels in the upper segment.

In the third quarter of 2008, the demand for hotel rooms in the capital's hotel market fell. The utilization of Moscow hotels did not exceed 50-55%.

The low level of congestion in the capital's hotels is associated with a reduction in the flow of foreign tourists from the beginning of 2008 by 10-15%, which, in turn, is due to the high cost of living in hotels of the middle and economy class with a low level of service and quality of service.

As a result of the impact of the financial and economic crisis, the flow of business tourists is also reduced, which made up the bulk of the structure of tourist flows - about 40% of the total inbound flow.

Events that take place on world financial markets in 2009 undoubtedly affect the capital's commercial real estate market, including the hotel segment. Many companies “freeze” or sell their projects, which include hotel areas. In this regard, it is expected that the opening dates of many hotels can be postponed, which will affect the growth rate of the capital's number of rooms. As a result, the development of the metropolitan hotel market, which did not have high dynamics in favorable economic conditions, will become even more complicated in the current situation. Thus, due to the slow pace of construction and commissioning of new hotel space in the coming years, the shortage of hotel rooms will remain, first of all, in the middle segment, which in the conditions of the crisis has become even less attractive for investors and developers.

Despite the 14% decrease in hotel room prices over the past year, the Russian capital is still at the top of the list of cities with the most expensive business hotels.

According to the report “Hotel Market Overview for the First Six Months of 2009” of the international company Hogg Robinson Group (HRG), the average room price in Moscow is 268.11 f. Art. per night, and Moscow ranks first in terms of high cost. In second place, Abu Dhabi - 253.36 pounds, in Paris it costs 203.46 pounds, in New York - 200.21 and in Milan - 191.28. London did not enter the top ten cities with the most expensive hotels, dropping from 16th to 23rd place with a price of 154.2 lbs. Art.

HRG experts note that rooms (5.7%) have risen in price the most (due to the artificially high prices of hoteliers who are struggling with low occupancy rates). However, today business travelers choose more affordable 3-4-star hotels.

In 2009, hotel occupancy actually decreased by 20-30%, which forced individual hotels to lower prices. For example, the "best price" currently in the Ritz Carlton can reach 6000-7000 rubles. per room per day, and at Holiday Inn - 3000-4000 rubles. True, these prices are not openly published 1.

Filed by the consulting company Blackwood, in the first half of 2009, the demand for Moscow hotel services decreased by one and a half to two times, the average load fell from 75 to 40-45%. The rate of revenue per room (i.e. the ratio of revenue from all rooms to the number of rooms, RevPar) decreased by 35-50% (depending on the class of the hotel).

Currently, the level of hotel occupancy continues to decline to 50-55%. Before the crisis, this figure was 75-80%. Significant increase in load associated with an increase in business activity, experts expect only by the end of the third quarter of 2009.

To save customers and attract new ones, hoteliers are ready to freeze and even reduce - up to 50% - room prices, despite rising costs. Also, in the fight for customers, operators offer increased agency fees.

Table 1.4. The price range for accommodation in Moscow hotels in the first half of 2009 (hotel price / Rack Rate)

According to Blackwood analysts, over the past years, Moscow has been among the leaders in terms of growth and absolute value of RevPar. However, under the influence of the crisis, the income level for the number of metropolitan hotels began to fall at a record rate. Today, among European cities, Moscow, like Russia as a whole, takes one of the last places in the growth of RevPar. According to company experts, the decrease in RevPar is caused by both a drop in ADR (average room price) and a decrease in hotel occupancy. Nevertheless, despite the decrease of the indicator by more than 40%, in its absolute value, Moscow continues to maintain its position.

In the near future, a significant increase in supply in the hotel market of the capital, which may entail a reduction in prices, is unlikely, analysts say. The situation with the pace of construction of new hotel facilities, which lag behind the planned from year to year, is currently exacerbated by the crisis. The commissioning deadlines for many landmark projects previously announced for opening in 2009 have been postponed (Moscow Hotel, Lotte Hotel, Rossiya Hotel), some other projects have been stopped (IKEA hotel projects, Kremlin Hotel complex), noted in a review prepared by Blackwood.

The Moscow authorities, concerned about the lack of tenants, intend to offer small offices in the premises in the center of the capital provided for by offices. As the prefect of the Central Administrative District of the city A. Alexandrov explained, back in the middle of last year, the Moscow authorities decided to ban the construction of offices in the center.

During the second quarter of 2009, the Moscow hotel market was replenished with two objects:

Thus, according to the results of the second quarter of 2009, the hotel fund of the capital increased by 235 rooms. Given the replenishment of the number of rooms in the first quarter by 248 rooms, the total increase in the first half of the year was 483 rooms.

According to the results of the first half of 2009, in Moscow there are 231 hotels with a total number of rooms of more than 36.6 thousand rooms, of which:

  • - class “lux” (5 stars) - 2902;
  • - business class (4 stars) - 6718;
  • - middle class (3 stars) - 15 711;
  • - economy class - 9466;
  • - mini-hotels (less than 50 rooms) - 1880.

Fig. 1.3. The proportion of hotels of various categories of class Source: Becar Realty Group.

The main share in the structure of the number of rooms is occupied by 3-star hotels (43%), but it is middle-class hotels that are the most popular, especially among tourists visiting Moscow for excursion and educational purposes.

The bulk of Moscow hotels are concentrated in the Central and North-Eastern districts. Together, these districts account for 50% of the capital's hotel fund. All 5-star hotels are located in the city center, as are most of the 4-star hotels and mini-hotels.

Despite the fact that hotels are gradually appearing outside the city center, most likely, the market structure by territorial distribution will not undergo major changes in the coming years.


Fig. 1.4. Location of Moscow hotels by administrative district Source: Becar Realty Group.

Until the end of 2009, it was planned to commission 17 hotels with a total fund of more than 3.8 thousand rooms (Table 1.5).

Among the hotels that were supposed to open in 2009, the objects of new construction of the highest price segment (“4-5 stars”) predominate mainly.

Against the backdrop of the economic downturn, real volumes of commissioned hotel space are most likely to be significantly less than announced.

Table 1.5. The most significant hotels scheduled for opening in 2009

Name

License plate

Hotel "Ukraine" (after reconstruction)

Kutuzovsky Prospect 2/1

Four Season Moscow (Hotel Moscow)

st. Okhotny Ryad. 2

Hotel in the hotel and office complex (Imperia Tower)

Krasnopresnenskaya nab., Section No. 4 (MIBC "Moscow City")

Grang Hyatt Residences & Spa (West Tower of Federation Complex)

Krasnopresnenskaya embankment. Section No. 13 (Moscow City Center)

st. Ilyinka. 4 (Gostiny Dvor)

The Mandarin Residences (2nd turn)

st. Olkhovskaya. 23

prospect Mira. ow 14. p. 3

Marriott Courtyard (Office-Hotel Complex Vivaldi Plaza)

st. Leatherworking, ow. 8/4

Hotel as part of IFC? River

st. Kuryanova, ow. 49-55

Renaissance Moscow Monarch Center

Leningradsky Prospect, ow. 31. p. 2, 3

Atrium (small extended stay hotel)

B. Spasskaya, 1/9, p. 1

Hotel

vnukovo Airport

Hotel as a part of Avrora Business Park (3rd stage)

st. Horticultural. 80

Administrative hotel complex SR-Royal

Dmitrovskoe sh., 163a

Ibis Moscow Paveletskaya

intersection of Dubninskaya and Shchipok streets

Maxima Panorama Hotel

m. Avtozavodskaya

Aquamarine (GOK as a part of IFC “Aquamarine-2")

Ozerkovskaya nab .. 26

Source: Becar Realty Group.

Every year in Moscow there are more and more hotels that are managed by professional hotel operators. Almost any hotel project in the highest segment (“4-5 stars”) involves the involvement of a management company, but at present this is more true for international operators, not Russian ones.

Among the events that occurred during the study period in the hotel management segment, it is worth noting the signing by the city authorities of an agreement with the international hotel company Starwood Hotels & Resorts, according to which the National Hotel will change its management network. Since 2001, the hotel has been managed by the Le Meridien chain, which will be replaced by The Luxury Collection, also owned by Starwood Hotels & Resorts. Agreement on the transfer of the hotel under the brand The Luxury Collection.

The most significant projects of international management companies that are planned to be implemented in Moscow, see table. 1.6.

Table 1.6. Hotels introduced in Moscow by international management companies

Operator

Projects in Moscow

discoveries

Hotel -Gostiny Dvor Novotel- 4 *

Sofitel 5 * hotel as a part of the transport terminal of the Moscow City Business Center

Four Season Hotels & Resorts

Hotel Moscow-

Apart-hotel as part of IFC on Sofiyskaya emb.

Grand Hyatt Moscow 5 * (Federation Tower)

It is planned to build a hotel under the Andaz brand

InterContinental Hotels Group

Moscow Tverskaya5 * (Hotel "Minsk")

Hotel in Moscow (reconstruction object)

Operator

Projects in Moscow

discoveries

Hotel as a part of IFC "Poseidon Park- (" Oceanarium ")
  • 2010-

Holiday Inn Ryazan 4 *

Holiday Inn Volokolamsk 4 *

Club hotel (as part of WTC-2) 4 *

Hotel as a part of IFC “Aquamarine-2”

Kempinski Hotels & Resorts

Kempinski Hotel Nikolskaya 5 *

5 * Hotel as part of Crocus City **

Kempinski Birch Moscow »5 *

Mandarin Oriental Hotel Group

Hotel Mandarin Oriental Moscow 5 * (on the site of the Central Hotel)

Hotel as a part of IFC "Metropolie-2"

Hotel "Bela" - reconstruction

Office and hotel complex Vivaldi Plaza 4 *

Rezidor SAS Hospitality

Radisson SAS Hotel Belorusskaya 4 *

Radisson SAS Olumpiysky 4 *

Radisson SAS Moscow Riverside Hotel & Resort 4 *

Hotel and business center "Business Plaza"

Hotel 3 * on the site of the old car dealership "Panavto"

Scandic Khimki 4 * (as part of Khimki BP)

Fairmont Raffles Hotels International

Raffles Moscow 5 * as part of the IFC Chizhevskoe Compound

During the study period, the following hotel facilities intended for sale entered the market (Table 1.7).

The following trends were characteristic of the hotel real estate market:

1. Due to falling demand, capital hotels have decided to reduce tariffs and renegotiate contracts with tour operators.

Hotels began to closely monitor all their sales, reducing prices for certain groups of customers, introducing various discounts, special offers and promotions. The result of the policy of mobile prices is to increase the competitiveness of Moscow hotels in terms of price and quality.

  • 2. There is a high level of interest in the industry from the state:
    • - new solutions are being initiated to expand the hotel fund, including through the use of space in shopping and sports complexes;
    • - Moscow authorities put up for sale their own facilities;
    • - Hotel Hotel Company is established as a joint venture with external investors in order to develop a placement system.
  • 3. The postponement of the commissioning of the facilities continues (for example, the project for the construction of a hotel on Ilyinka St.,

Over the past nine years, the tourism industry in Moscow has received a powerful impetus for development and has changed greatly. The number of tourists staying in hotels over the past 3 years has grown by 80%, and the income of the hotel industry over the past three years has grown by 122%.

One of the main elements of tourism development is the hotel industry, which currently numbers 1.7 thousand hotels and similar accommodation facilities. The average annual utilization of metropolitan accommodation facilities is 77%, which is comparable with that of Amsterdam, London and Paris.

Today, Moscow already offers a full range of services that allows you to make the stay of tourists in the city as comfortable as possible. This includes transport infrastructure, the level of service and the urban environment as a whole. Improvement of streets and parks, festivals and holidays, improvement of transport and safety - all this is done not only for Muscovites, this infrastructure is also important and significant for tourists.

It is worth noting the influence of the festival and event program of Moscow on the hotel industry in Moscow. Over the past 2 years, pronounced seasonality has practically disappeared, which allows hotels to work with high load and profitability all year round.

The event agenda of Moscow became the driver of the growth of the tourist flow and the development of the hotel industry. So during the celebration of Moscow City Day 2019 (September 7-8), hotel loading was more than 90%, of which 65% were foreign tourists. The leaders from non-CIS countries by the number of hotel guests are China, Spain, the USA, Israel and Argentina. And the holiday sites themselves were visited by 7.9 million people.

According to the Committee on Tourism of the city of Moscow, today in the capital there are 1718 hotels, hostels, furnished rooms that have passed the qualification procedure and received the appropriate category. Five stars were awarded to 41 institutions, four stars - 132, three stars - 331, two stars - 152, one star - 86, 976 institutions - without stars.

The share of the number of rooms in three-star hotels is 44.4%, four-star - 17.8%. With regard to the global situation, the share of three-star hotels averages 27%, four-star hotels - about 50%. This means that Moscow hotels are on average more affordable and affordable.

377 hotels in the capital have more than 50 rooms, 609 hotels and mini-hotels have less than 50 rooms. The rest - 713 hostels and 19 furnished rooms.

The total number of hotels in Moscow is 82.9 thousand rooms. This is almost twice as much compared to 2010.

44 hotels with a total fund of more than 13 thousand rooms operate under well-known international brands: Four Seasons, Hilton Hotels & Resorts, Holiday Inn, InterContinental, Kempinski Hotels & Resorts, Marriott Hotels & Resorts, Ritz Carlton, Swissotel, Pentahotel and others.

Until 2010, most Moscow hotels comprised one-three star accommodation facilities. There were few hotels in the capital market corresponding to the four to five star category. Over the past 10 years, the number of places in hotels of the European level has increased several times. By the end of 2018, their share in the number of rooms of all collective accommodation facilities in Moscow exceeded 34%, which is comparable to the average European indicators for the provision of tourists with quality hotels.

Until 2010, it was almost impossible to say how many hotels functioned in Moscow, since hotel activities were never licensed. Today, thanks to the preparation of the city for the 2018 FIFA World Cup, all Moscow hotels have been taken into account, passed the mandatory state classification and are divided into six categories: “no stars”, “one star”, “two stars”, “three stars”, “ four stars ”,“ five stars ”.

“The most important achievements of the metropolitan hospitality industry for the period 2011 - 2019 are to reach the average annual load comparable to the hotels of the leading European capitals in the tourism industry. And, more importantly, Moscow during this period was the first of the largest Russian cities to significantly reduce seasonal fluctuations in the number of rooms, primarily due to the development of cultural and educational tourism, the event series of the capital and simply because the city itself became prettier and became more tourist attractive, ”said the president.

Until 2010, there were not so many hotels in Moscow with restaurants, not to mention other venues adapted for organizing leisure or business. There were practically no hotels with a spa area. Today, almost all four-star, five-star hotels, of which there are 173 in Moscow, have modern conference zones, a bar or a restaurant. Five-star hotels have a spa and pool. Revenues from the provision of additional services in up to 40% of the total revenue of the hotel.

Significantly increased hotel load. For example, until 2010, the Cosmos hotel complex was 25-30% loaded with power, and the Ukraina hotel 20 to 40%. Today, the Cosmos hotel complex and the Radisson Collection Hotel Moscow (formerly Ukraine Hotel) are 75-80% full, regardless of the season.

By given Cushman & Wakefield, over 10 years the nominal growth of the Moscow market of hotel rooms of modern quality by 2018 amounted to 202%. During this period, the market grew at an average rate of 8.1% per year, with “peaks” of activity in 2010, 2011 and 2017, when the volume of quality supply increased by 21.2%, 10.1% and 9.4%, respectively.

Target Audience Changes

A series of changes in the industry were the preferences of a new class of millennial travelers. Moscow also does not lag behind world trends in hospitality.

Hotels are forced to adapt to a new generation of target audience. Mega-hotel chains are currently redefining their development strategies. According to research Landor Associates, they are no longer considered the most innovative. The most far-sighted players expand their portfolios, make new sub-brands.

All world and Moscow trends in the hotel industry are associated with an increase in the number of millennial travelers - people born between 1980 and 2000. Millennials matured in the digital age. To better understand the trends in the hotel business in Moscow, you first need to understand the values \u200b\u200bof millennials - the target audience in the hotel services market.

According to Mikhail Gitman, Director General of AZIMUT Hotel Smolenskaya Moscow, in recent years the proportion of young people has been steadily growing and this has a bearing on the hotel industry. Now it’s important not only to provide the guest with a cozy, quiet room, to deliciously feed him and provide impeccable service, but also to give the opportunity to get vivid impressions, emotions. This can be expressed in the unusual design of the hotel, the original restaurant or some other moments about which guests will be happy to tell their friends and acquaintances, primarily through social networks.

“If the hotel is organically integrated into the urban environment, has partnerships with museums, exhibition centers, viewing platforms, all that helps guests diversify their leisure time and learn something new, then this is a big plus for the hotel. Those who successfully cope with the task of giving impressions to their guests have a certain competitive advantage and show results higher than the average ones, ”says Mikhail Gitman.

Millennials are people with a non-standard and flexible mind, living in a frantic rhythm and not representing a different lifestyle. For millennials, material status is already less important - representatives of this generation sometimes want to have exactly as much money as will be enough to satisfy their interests. And therefore they are not inclined to accumulations, do not want to buy expensive cars, own apartments and houses, expensive jewelry and branded clothes, but they know where to rent all this. They spend money on new educational gadgets courses and travel.

Therefore, modern hotels strive to create a very personal brand commitment - this is the number one trend. Between them and their guests there was “more air”, loyalty programs changed significantly. Paying millennials dictate rules to the market. Modern guests of the capital would rather prefer free bikes for rent in the room. They are less interested in their pleasure, for example, they are more concerned with carbon dioxide emissions and how to reduce the carbon footprint that they will leave in their city of residence.

Trend number two relates to design - authenticity and diversity. Since 2010, the approach to design has changed significantly. While guests themselves are no longer afraid to be bold and colorful, hotels now design their rooms in a more natural, welcoming way, combining eclectic elements: contrasting colors and bright, old and new. There are more unexpected texture combinations in hotels. The hotel business has been covered by a new wave of design, in which the love of history is intertwined with modern elements and functionality.

The boutique approach to hotel design helps create a truly authentic and exciting experience that modern guests expect, especially millennials. Over the past nine years, hotels have learned to maintain a balance of elegance and simplicity, without giving up the excellent service of a five-star hotel.

Trend Number Three - High Rate of Change. This trend illustrates well how quickly the transition to online booking was completed.

Environmental friendliness is trend number four, which has long been relevant and important for many industries and projects.

Trend number five - instagrammability. Travelers have always sought to visit picturesque places. With the advent and development of social networks, this desire has only intensified. Now a visit to Moscow allows you to collect likes and get new followers. In the newspaper Independed, the results of a study by the British company Schofields Insurance were published, during which more than 1,000 young people aged 18 to 33 were interviewed. To the question: “What is the most important when choosing a vacation spot?” - the majority replied: “Intramability”.

Modern hotels are puzzling how to make guests feel at home while away from home - trend number six. The hotels have a real mission - to create their own community. Hotels respond differently to the challenges of the time. To create a community, they, for example, encourage the socialization and cooperation of their guests - organize coworking in the lobby.

Trend number seven follows from the previous trend - the spread of hostels and coliving. As the hotel market is tough, investors are looking for new formats. Opinions of hoteliers and hotel owners agree that 2019 dictates the development of collective accommodation facilities.

Starting from 2012, economical accommodation facilities, hostels, began to appear actively in Moscow. These types of economical hotels have gained great popularity among foreign and Russian tourists, mainly young people, and today their number is 713 units. By the way, 95% of hostels are located outside apartment buildings, since the city policy in this direction has always been unchanged: the hotel business should not interfere with the peace of Moscow residents.

“Today, young travelers go for emotions, thoughtfulness and entertainment. Hotels adjust to market changes and tourist preferences. For example, in order to be on the same wavelength with the millenials, our network has launched a special project, within the framework of which we organize DJ sets in the lobby and restaurant, sponsor DJ contests and street art festivals. We have coworking zones for communication and work. We try to keep up to date - we design public areas and rooms in a bright and unusual way. We value guest ratings and reviews, we try to engage our potential customers through social networks - this is how we consistently build our reputation, ”said Natalia Grineva Oktyabrsky Pole, General Manager of Combo Ibis & Ibis Budget Moscow.

Coliving and apart-hotels represent a new format of the hotel industry, for a rental period for a longer period. The format is starting to spread in Moscow. Apart-hotels coming to Moscow live from two weeks or more. A distinctive feature of apart-hotels is the availability of kitchen equipment that allows tourists to cook their own meals. Due to longer stays, the cost of services in apart hotels is approximately 20-30% less than in a regular hotel. The users of apart-hotel services are citizens who have arrived in Moscow on a long business trip, as well as for the purpose of training, obtaining medical services, and tourists with a large family. Today in Moscow there are more than 40 apartment hotels.


* The calculations use the average data for Russia

This market analysis is based on information from independent industry and news sources, as well as on the basis of official data from the Federal State Statistics Service. Interpretation of indicators is also carried out taking into account data available in open sources. Representative directions and indicators are included in the analytics, providing the most complete overview of the market in question. The analysis is carried out as a whole in the Russian Federation, as well as in federal districts; The Crimean Federal District is not included in some reviews due to the lack of statistics.

The hospitality industry (hotel business) is a business aimed at providing visitors with housing, meals, as well as organizing their leisure. Based on this definition, we can conclude that the main customers of hotels are people who make primarily tourist and business trips. Perhaps one can distinguish other purposes of travel, but all of them will somehow come down to the two indicated.

There are many subjects of the hotel business: hotels, pensions, guest houses, hostels, etc. Depending on their status, they provide a different set of services. However, the main product of the hotel business is the placement of guests on the premises of the hotel, designed for this, on a reimbursable basis. There are also related products: food, leisure, consumer services.

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According to the classifier of OKVED, the activity of hotels belongs to section 55 “The activity of hotels and restaurants” and has the following division:

55.1 - hotel activities;

55.11 - activities of hotels with restaurants;

55.12 - activities of hotels without restaurants;

55.2 - activities of other places for temporary residence;

55.21 - activities of youth tourist camps and mountain tourist camps;

55.22 - activities of campsites;

55.23 - activities of other places for living;

55.23.1 - activities of children's camps during the holidays;

55.23.2 - activities of boarding houses, rest houses, etc .;

55.23.3 - rental of furnished rooms for temporary residence;

55.23.4 - the provision of places for temporary residence in railway sleeping cars and other vehicles;

55.23.5 - activities of other places for temporary residence not included in other groups.

Hospitality as an industry does not exist by itself. Its development depends on the development of those industries that provide demand for its services - primarily tourism and business.

In recent years, interest in domestic tourism in Russia has been growing, due to a number of economic and political factors: the annexation of Crimea, the popularization of domestic tourism destinations at the state level, the decline in the solvency of the population, armed conflicts in the Middle East, etc.

According to the World Tourism Organization, in 2014, Russia was visited by about 28 million tourists from abroad, which puts it in 9th place in the world in terms of tourist attractiveness.

According to the Federal State Statistics Service, from 1995 to 2011, the influx of foreign tourists to Russia increased by 27%. On the other hand, in the same period, Russians mastered many foreign tourist destinations - primarily beach: Turkey, Egypt, Thailand, Greece, Bulgaria. In 2010, the number of domestic tourists was 32 million people. Unfortunately, similar data for recent years are not presented in the open sources of Rosstat or the Federal Agency for Tourism. However, it should be assumed that in 2015 domestic tourism destinations were even more in demand than in previous years; and in 2016 we should expect an unprecedented growth of the industry.

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The main obstacle to the growing popularity of domestic destinations is an undeveloped infrastructure: the relatively low quality of rooms, services, and the lack of a wide range of services; all this against the background of a fairly high price level.

As for business trips, their volume depends on the economic situation in the country and general business activity. In 2014-2015, there was a recession in the economy, a tendency to reduce the costs of business entities (not least by reducing travel expenses), and a number of domestic and foreign players leaving the market. Thus, we have to admit a decrease in interest in the services of hotels focused on business trips. Given the general economic forecast, in the coming years we should expect a recession in this area to continue.

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The only predictable growth factor in demand for both business and tourism destinations is the holding of the 2018 World Cup in Russia.

For the most accurate display of the situation in the hotel services market, the analysis of indicators presented by Rosstat is carried out in the most representative areas of OKVED: 55.1 and 55.23.2. Directions not included in the review, such as 55.23.3 or 55.23.5, theoretically can to some extent be related to the industry in question, however, it is not possible to determine the extent to which it is.

Figure 1. Dynamics of the main financial indicators of the direction 55.1, thousand rubles


Figure 2. Dynamics of the main financial ratios of the direction 55.1,%


You can see in the diagrams that, according to most indicators, the industry showed negative dynamics in 2014 - first of all, gross revenue decreased. However, it is noteworthy that the profit from sales at the same time increased, which was most likely caused by the relative decrease in the cost of services - it was more significant in 2014 than the decrease in revenue. This confirms the growth in gross margin. The number of market players, according to the Federal State Statistics Service, practically did not change in the analyzed period.

For the first three quarters of 2015, the industry showed good results, almost catching up with the full year 2014 in revenue, and even surpassing it in profit: 5.3 billion rubles against 4.8 billion. Financial ratios, on the contrary, show growth, even within negative scale. So, for example, as mentioned above, in the first three quarters of 2015, the gross margin of the industry exceeded the performance of the previous five years; increased return on sales. The profitability of fixed assets, taking a negative value, nevertheless increased significantly compared to 2014. The share of loans and borrowings in short-term liabilities decreased, the degree of provision with own funds increased. Such dynamics indicate a trend towards financial recovery of the industry.

Figure 3. Dynamics of the main financial indicators of the direction 55.23.2, thousand rubles


Figure 4. Dynamics of the main financial ratios of the direction 55.23.2,%


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The situation with pensions and rest homes is somewhat different. In 2014, there was a significant increase in almost all indicators. At the same negative level, only profit from sales remained, which may be caused by an increase in the cost of services. The main difference between boarding houses and rest houses from hotels is the availability of additional services, such as catering, medical and recreational procedures and recreational activities. It is likely that the presence of such a complex makes this type of enterprise more vulnerable to a crisis economic situation.

In further analysis, we restrict ourselves to considering direction 55.21 only in the most representative regions: the Southern Federal District, the Volga Federal District, and the North Caucasus Federal District.

Figure 5. Dynamics of the main financial indicators of the direction 55.1, NWFD, thousand rubles


Figure 6. Dynamics of the main financial indicators of the direction 55.1, Central Federal District, thousand rubles


Figure 7. Dynamics of the main financial indicators of the direction 55.1, Volga Federal District, thousand rubles


Figure 8. Dynamics of the main financial indicators of direction 55.1, Southern Federal District, thousand rubles


Figure 9. Dynamics of the main financial indicators of direction 55.1, Ural Federal District, thousand rubles


Figure 10. Dynamics of the main financial indicators of direction 55.1, Siberian Federal District, thousand rubles


Figure 11. Dynamics of the main financial indicators of the direction 55.1, FEFD, thousand rubles


Figure 12. Dynamics of the main financial indicators of direction 55.1, North-Caucasian Federal District, thousand rubles


Figure 13. Dynamics of the main financial indicators of the direction 55.1, KFO, I-III quarter of 2015, thousand rubles


Figure 14. Shares of regions in shaping the market volume (by revenue) for the I-III quarter of 2015, direction 55.1,%


Figure 15. Dynamics of the main financial indicators of the direction 55.23.2, North-Caucasian Federal District, thousand rubles


Figure 16. Dynamics of the main financial indicators of the direction 55.23.2, Southern Federal District, thousand rubles

Figure 17. Dynamics of the main financial indicators of the direction 55.23.2, KFO, I-III quarter. 2015, thousand rubles


Figure 18. Shares of regions in the formation of the market volume (by revenue) for the I-III quarter of 2015, direction 55.23.2,%


As can be seen from the above diagrams, in 2014, the overall dynamics of indicators throughout the country is reflected in the decline in profits in almost all regions, with the exception of the Ural Federal District and the Central Federal District. In the Ural Federal District, an increase in profit occurs against the background of an increase in revenue. In the Southern Federal District, with a significant increase in revenue, profit actually remained at the level of 2013.

Figure 14 shows the distribution of revenue shares by code 55.1 for the first three quarters of 2015 by region. The Central and Northwestern federal districts are leading in this indicator, which is quite logical, because Along with the highest business activity, they are also of interest to a large number of tourists, primarily from abroad. As for the main resort destinations, the ratio of the shares of the Southern Federal District and the Volga Federal District is quite expected - despite the high interest of the Russians on the Crimean peninsula, logistics in this direction is difficult. However, a significant annual increase in the market share of CFD is expected: the climate here is more favorable than on the coast of the Krasnodar Territory, the density of vacationers is not so high; and the construction of a bridge across the Kerch Strait in the future will provide unhindered communication with the rest of the Russian Federation.

The situation is uncharacteristic for the North Caucasus Federal District, whose share is less than 1%; since 2011, the region’s revenue in this industry has decreased almost three times, which can be explained, presumably, only by the decline in popularity of the resorts of the Stavropol Territory due to the imperfection of the number of rooms and the incorrect pricing policy in this sector.

In terms of revenues of boarding houses and rest houses, the CFD and the Southern Federal District are leading, which is quite expected; in total, they occupy more than 60% of the market.

The year 2014 turned out to be rather complicated for the hospitality industry. The combination of domestic and foreign policy factors caused a drop in hotel revenue; profitability, however, has grown, providing a higher level of profit than in 2013. Despite the decline in certain indicators in 2014 and the absence of improvements in the state of the country's economy, for the three quarters of 2015, the industry managed to exceed the profit indicators of the entire last year. It is likely that market players are optimizing costs by lowering costs and increasing profitability.

The positive dynamics of 2015, combined with a growing interest in domestic directions and the forced abandonment of a number of foreign ones, make the industry attractive enough for investment. First of all, it concerns enterprises serving the tourism sector. Of greatest interest from this point of view is the Crimean Federal District - it is expected to attract the greatest interest from vacationers, given that its infrastructure is largely a legacy of the Soviet Union with a low level of service and number of rooms. Investments aimed at creating high-quality hotel infrastructure in the CFD have great chances to pay off in the shortest possible time and provide the investor with high profit.

As for the business area, here from the players, most likely, they will need to mobilize all resources to overcome the protracted recession. However, as world practice shows, the crisis has a healing effect on any industry, freeing the market from random and weak enterprises.

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The domestic hotel business market is not going through the best of times. The development problems voiced by industry analysts are considered to be poor involvement in the field of professionals and a tangible run-up with the tourism industry. The main catalyst for the support of the hotel business in Russia remains the placement of rooms in off-road areas. There is no need to go far to confirm such data. According to official figures, almost 70 percent of the industry is hosted by hotels and hotels in two cities of federal significance - Moscow and St. Petersburg.

Problems and catalysts for the development of the Russian hotel business in infographics:

General trends

According to official figures, Russia in terms of total room supply per capita continues to lag behind European partners. At the same time, most entrepreneurs complain of a low level of customer demand. The result of low consumption is a sharp reduction in the cost of maintaining hotels and, as a result, a deterioration in the quality of service.

According to experts' forecasts, the ratio of the hotel market turnover in the coming years will significantly change towards regional consumption. The interest of investors is due to the attractiveness of large industrial cities, which are able to host significant conferences, stages of world-wide events. According to the analysis of the hotel market conducted by rating agencies, the regional hotel business has a serious potential to attract business activity in conditions of high competition.

Key analysis parameters

Most of the studies conducted in relation to the Russian hotel industry are based on the indicators of Moscow and St. Petersburg. An analysis of the Moscow hostel market allows us to formulate real key indicators that can be used as the basis for decision making among developers and potential investors. In 2010, the program “Development of domestic and inbound tourism in the Russian Federation (2011 - 2018) was launched to help the services sector. Today you can evaluate the actual results of the seven-year plan:


As can be seen from the analysis of the hostel market, at the beginning of the launch of the targeted development program, the potential of the hotel business to accommodate the internal flow of tourists was 70 percent of the maximum possible level. What is noteworthy, it is at the same level that the market share of cities of federal significance is located. In their assumptions, experts note that greater success was achieved precisely in the development of the hotel industry at the regional level.

Similar growth rates have been achieved in increasing the potential for admission of foreigners. And so it was possible to achieve an increase in the number of rooms. The diagram clearly shows that active growth in construction occurred in 2016-2018, in the period ahead of the World Cup.


The most active growth in the number of rooms was observed during the World Cup, which once again confirms the industry’s dependence on significant events. According to tenant surveys, the cost of living in apartments located in the host stadium area increased tenfold during the summer period. There have been cases when regular tenants were sharply denied accommodation in favor of tourists from among the fans.

With regard to Moscow and St. Petersburg, the development of means of accommodating the tourist flow is somewhat limited housing and cultural objects. In the regions, the situation is somewhat different, since the potential for the construction of a new number of rooms by developers remains.

Loading room stock

When analyzing the hotel market, one of such indicators of the level of demand for hotel services as loading should be taken into account. The industry average is not more than 49 percent. With the implementation of the targeted development program, by 2018 it was possible to increase this indicator by no more than 5 percent. It should be noted that the hotel business in Russia, according to statistics, is much better developed in the regions. Everything is explained again by the activity of the mayors, who today emphasize the development of tourism. With the influx of new visitors to the regions, the need for number of rooms is increasing.

Despite the fact that there is a lack of middle class rooms in the industry as a whole, developers continue to build class 4-5 hotels. Following the trend is due to the fact that the average payback period of the number of rooms, and especially the new one, is at least 10 years. There is a direct correlation - the higher the class of the hotel, the faster the investment will begin to return to the capitalists.

* Particular attention among industry representatives is riveted to the seasonality of the business. St. Petersburg remains particularly sensitive in this regard, and the more southerly areas where the tourist flow can persist for at least 5 months remain the most beneficial.

Attracting capital to the industry

If the consumer demand in the industry as a whole is understandable - there is a sensitivity to value and quality, then investors are even more capricious. In focusing on the development of the hotel business, capitalists are guided by indicators of the profitability of the industry. According to studies and statistics of the hotel market, the profitability of this service sector can reach the level of a niche of rented real estate for the needs of corporate parties (placement of offices, warehouses).

For example, profitability in Moscow, regions and Europe:


Profitability study results clearly show the attractiveness of hotel real estate for accommodating not only residents, but also serious investments. This is not surprising, because Moscow is considered one of the most expensive cities in Europe.

Among the latest trends that give a real impetus to the maintenance and development of the industry is the construction of complexes of wide functionality. Among the areas that such centers will cover are the creation of accommodation facilities for vacationers.

 

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