The hardest hit Prague hotel market in Europe but an expected rebound
Concretely, the occupancy rate of the rooms fell from 78.5% to only 16.6%. On top of that, the average room price fell 28.1% to CZK 1,716 per night.
However, according to the study, investor and hotel interest has not taken such a dip, with many industry players expecting a market recovery once restrictions aimed at curbing the spread of Covid- 19 will be lifted.
That said, industry insiders say they don’t expect a full recovery until 2024.
BoÅ™ivoj VokÅ™Ãnek of Cushman & Wakefield said that during the first wave of the pandemic, the Czech government was one of the first to introduce strict measures, including the forced closure of hotels.
In the second wave after the summer, the country experienced one of the most endemic Covid infection rates, once again leading to a drastic halt in international tourism and hotel closures, VokÅ™Ãnek said .
He said that unlike other states, the Czech Republic did not use hotels as accommodation for health workers or as field hospitals.
Mr VokÅ™Ãnek said the Prague hotel market could rebound quickly once the virus is under control.
Most visitors tend to come from Europe, with European guests accounting for 73% of hotel nights in Prague in 2019, he said, explaining his optimism.
David Nath of Cushman & Wakefield said Prague is a preferred destination for long-term investors. He said major industry players were still interested in buying, renting or operating hotels in the city.
Indeed, demand clearly exceeds supply, which is keeping hotel prices at their pre-pandemic level, Mr Nath said.
An increase of only 1,750 rooms is expected over the next three years, as only a relatively small number of new hotels will be built.
In addition, there was talk of reducing the number of short-term rentals in Prague and lowering the VAT rate on housing. All of these factors mean that owners feel hotels have the same value they were two years ago, Nath said.