Market Report

Poland Hotel Market 2021

Poland's economic landscape experienced significant growth throughout the 2010s, highlighted by a 4.7% GDP growth in 2019, one of the highest in the European Union. The onset of the COVID-19 pandemic in 2020, however, reversed this trend, resulting in a GDP contraction of -2.7%. Despite this downturn, Poland's economy showed resilience, recording one of the shallowest recessions in the EU with a GDP drop far less severe than the EU-27 average of -6.1%.

Office Space Market

The demand for office space in Poland, particularly in Warsaw, continued to grow despite the pandemic. Warsaw remains the largest office market in Poland, followed by Cracow and Wroclaw. The city is also home to significant infrastructure developments, including the construction of Varso Place, set to become the tallest office building in the EU. The Business Process Outsourcing sector, which has been expanding for nearly 15 years, has been a major driver of office space demand.

Tourism and Hospitality Sector

The tourism sector in Poland was heavily impacted by the COVID-19 pandemic, with international arrivals dropping by 74% globally. Poland saw a 49% reduction in tourists in 2020, with domestic tourists decreasing by 43% and foreign tourists by 70%. The number of overnight stays in Polish hotels plummeted from 44.8 million in 2019 to 23 million in 2020. Hotel occupancy rates in major cities like Cracow and Warsaw fell drastically, with Cracow experiencing the lowest rate at 21.3%.

Infrastructure Development

Significant investments have been made in Poland’s infrastructure, particularly in road development and airport expansion. Over the past years, Poland has added approximately 4,300 kilometres of new express roads and highways, with plans for an additional 3,500 kilometres. The expansion of airports has increased the total number of airports in Poland to 14.

Hotel Market Trends

The Polish hotel market saw a reduction in the number of hotels and hotel rooms in 2020 for the first time in years. The pandemic led to a significant drop in both domestic and international tourists, severely affecting hotel occupancy and profitability. Despite these challenges, new hotel brands and international chains have entered the Polish market, driven by favourable pre-pandemic trends in average daily rates (ADR) and occupancy rates (OCC).

Future Prospects

Looking ahead, the European Commission forecasts a return to pre-pandemic economic levels by the end of 2021, with substantial support from the Recovery and Resilience Facility (RRF). Poland is set to benefit from €57.3 billion in loans and grants to support economic reforms and investments. The hotel industry, while facing ongoing challenges, is expected to recover as vaccination efforts continue and restrictions ease.