This year will likely go down as one of the best for Kyiv’s hotel market, with 19 new hotels slated for construction in the first nine months, compared to two hotels last year, according to a report by Knight Frank, an international real estate consultancy.
But if more tourists don’t come, the positive trend could soon peter out.
Ranging from two to five stars, the hotels opened January through September brought the capital more than 2,000 new rooms in total, significantly higher than the 372 rooms added in whole of 2011.
They also brought two international players to the local market: In the first quarter of 2012, Fairmont Raffles Hotels International opened a five-star Fairmont Grand Hotel in Kyiv’s riverside Podil area.
The next quarter came Wyndham Hotel Group, which opened a three-star Ramada Encore Kyiv on Stolychne Highway, the city’s southern entrance.
Bigger supply, lower occupancy rates have little effect on prices
One of the main drivers of the trend was the Euro 2012 football championship, co-hosted by Poland and Ukraine this summer.
As a result, the number of hotels commissioned in the second quarter of this year rose threefold compared to the first.
Since then, commissioning has continued although the pace has significantly slowed.
This has been matched by decreased numbers of tourists after Euro 2012, the real estate consultancy’s experts noted.
The occupancy rate of Kyiv hotels in the third quarter fell off by up to 10 percent.
But a bigger supply of rooms does not seem to have lowered prices. During the survey period, the average price of a standard double room with breakfast increased by four percent to $460-$640 per night for a five-star hotel, by 18 percent to $135-$400 per night for a four-star hotel and by 21 percent to $76-$194 for a three-star hotel.
Yet Knight Frank’s business development director Yaroslava Chapko believes the current trend is unlikely to last.
“A reducing flow of tourists, as well as increasing competition, will force hotels to show loyalty to clients, reduce prices and offer a variety of bonuses and packages to meet the target occupancy level,” Chapko is quoted in the report.
Construction of new hotels in Kyiv continues but commissioning is usually postponed. Only one hotel is expected to open its doors by the end of the year. It is a four-star Radisson Blu Hotel at Bratska street in Podil district.
Kyiv Post staff writer Oksana Faryna can be reached at [email protected].
