Report

Benelux HOSTA Report 2023

The Netherlands' hotel market remains a robust asset class, demonstrating resilience despite economic challenges. The sector's performance, as tracked by key indicators like Occupancy (Occ), Average Daily Rate (ADR), and Revenue Per Available Room (RevPAR), shows positive trends since the COVID-19 pandemic's impact in 2020. The market's recovery is driven by strong domestic and international demand, and strategic adaptations by hoteliers.

Performance Metrics

Data from STR and Horwath HTL highlights a steady improvement in the Netherlands’ hotel sector:

Occupancy (Occ): The occupancy rates have seen a significant rebound, approaching pre-pandemic levels. Amsterdam, as a key market, exhibits a notable recovery trend with occupancy rates stabilizing and gradually increasing.

Average Daily Rate (ADR): ADR has shown consistent growth, reflecting both an increase in demand and hoteliers’ ability to command higher prices. This growth indicates a recovery in pricing power across the sector.

Revenue Per Available Room (RevPAR): RevPAR, a critical profitability metric, has also improved significantly, driven by both higher occupancy and ADR.

Regional Insights

Amsterdam: As the primary tourism hub, Amsterdam’s hotel market has experienced a robust recovery, with performance metrics surpassing those of regional areas. This trend underscores Amsterdam’s pivotal role in the overall health of the Dutch hotel sector.

Provinces: While the recovery in the provinces lags slightly behind Amsterdam, there has been substantial improvement. The occupancy and ADR indices for the provinces are steadily climbing, indicating a broader recovery across the country.

Market Dynamics and Investment Trends

Contract Types: The report discusses various contract types prevalent in the market, such as fixed lease, hybrid lease, variable lease, and management contracts. Each type presents different risk and return profiles, influencing investor preferences.

Investment Activity: Hotel investment activities globally and in the Netherlands have seen fluctuations. Although the number of transactions reached an all-time high, the overall transaction volume has been lower, reflecting cautious investor sentiment amidst economic uncertainties.

New Supply: The development of new hotel supply has been notably lower post-pandemic. This restrained growth in supply, coupled with recovering demand, is expected to support continued improvements in occupancy and ADR.

Future Projections The forecast for the Netherlands’ hotel market is optimistic:

2023 and Beyond: Projections indicate that both occupancy and ADR will continue to grow, supported by sustained demand and limited new supply. RevPAR is expected to maintain its upward trajectory, reinforcing the sector’s appeal to investors.

The Netherlands’ hotel market is proving to be a resilient and attractive investment asset class, outperforming inflation and providing solid returns for professionally managed properties with appropriate contracts. The strategic positioning and robust recovery metrics underscore the sector’s strength.