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Moscow has one of the Most Expensive Hotel Room Rates in Europe

In the first half of this year average quality hotel room rates in Moscow have topped $290 per night coming behind to London at $370 per night, and Paris at $345 per night; making Russia’s capital one of the most expensive destinations to stay in Europe and the world. Over the same period, Moscow’s room rates have soared by 19% on this time last year, surpassing the majority of principle cities in Europe including Rome, Madrid and Berlin.

Mark Wynne-Smith, European CEO, Jones Lang LaSalle Hotels said: “Moscow has seen a major increase in annual foreign visitors – from 1.5 million to 3.5 million between 1999 and 2005, the figure is expected to reach 5 million by 2010. Foreign travellers requiring Moscow hotels accounted for 1.3 million last year and the demand for quality or modern standard hotels came from the business sector – almost 80%. Corporate and business travel and the demand for high quality accommodation are keeping the room rates high.”

Moscow has an estimated 183 hotels, amounting to 40,000 rooms but the number of modern standard rooms only totals approximately 9,500 leading to an undersupply of quality accommodation. However by 2011, with a number of hotel developments in the pipeline, room count is expected to surpass 14,500. Similar sized cities like London has approximately 71,000 hotel rooms and Beijing has around 108, 500.

Marina Usenko, head of Jones Lang LaSalle Hotels in Russia said: “With the shortage of quality stock alongside the growing number of arrivals, Moscow’s hotels performance has seen a boom since 2003. According to results in 2005, the market has seen an increase in average room rates and room yields of 32% and 28% respectively over the previous year. Due to the boom in demand and inadequate supply, room yields have grown by 14% in the first half of 2006.”

“Although leased apartments, branded residences, aparthotels or condominium hotels are a novel concept, the introduction of Orco Property Group’s aparthotel brand as well as the active search by a number of aparthotel operators, signifies the emergence of a new trend in the Moscow hotel sector”, She concluded.

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