Greece’s hotel sector recouped 60 percent of pre-pandemic 2019 turnover levels marking a recovery of 170 percent, a new study released by ICAP CRIF found highlighting the importance of the sector as a driver of the Greek economy.
The clearly better course of tourism with double total arrivals in 2020-2021 resulted in the total size of the market increasing by 172 percent, said Konstantinos Paleologos, ICAP CRIF Financial-Sectoral Studies Department manager.
Key takeaways from the ICAP CRIF “Hotel Enterprises” study include:
– international tourists accounted for more than 80 percent of overnight stays
– the number of night stays dropped in 2020 by 70 percent from 109 million in 2019 to 30 million as a result of Covid-19
– average annual occupancy went from 48.7 percent in 2019 to 29.6 percent in 2020
– 5-star hotels accounted for the largest percentage – at 44 percent – of the total market in 2021
– from 2004 onwards, hotel infrastructure across Greece was upgraded with more units offering higher quality services
– a total of 10,052 hotel units operated in Greece in 2020 with a capacity of 870,000 beds
– 2-star hotels account for the largest percentage of Greece’s total hotel offering (approximately 36 percent).
– the South Aegean Region has the largest number of beds with a share of about 26 percent.
Covid-19: A catalytic effect on industry’s development
According to the “Hotel Enterprises” study, Covid-19 had a catalytic effect on the development of the industry. The slump suffered by global and consequently Greek tourism led to a contraction of hotel company activity with a direct impact on their revenues. The decline in tourist arrivals in Greece exceeded 70 percent compared to 2019, putting a brake on the upward trend of the domestic hotel market in 2020 and leading to a 76 percent decline compared to the previous year, said Paleologos, who supervised the study.
Looking ahead, Stamatina Pantelaiou, director ICAP CRIF, underlined the importance of the Greek hotel sector ensuring a speedy rebound and recouping as fast as possible 2019 revenue levels. She points out that the prospects for Greek tourism are positive with investment interest in the hotel industry stronger than ever as large international hotel chains have entered the Greek tourism market, while several others are interested in expanding to Greece demonstrating their confidence in the Greek tourism product.
With regard to the Russia – Ukraine war, ICAP CRIF analysts expect it will impact tourist arrivals to Greece from the two countries which however account for a small market share – 1.9 percent or 583,000 arrivals in 2019 – thus having limited losses for Greece.
On the downside, the study expects consumer purchasing power to wane as a result of rising energy prices.