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News Release

​Moscow

2015 Russia & Ukraine Hotel Market. “How Is The Year Going?”


​​Moscow, 24 March, 2015 – David Jenkins, Head of JLL Hotels & Hospitality Group, comments on the 2015 January-February Russia & Ukraine hotel market trends:

“We have the hotel performance figures now for January and February 2015 so we have briefly compared the results to the same first 2 months in 2014. Bearing in mind that at this point last year we had not really seen too much of an impact of the Ukraine crisis on the Russian hotel market.

Moscow

The opening of the Four Seasons seems to have pushed the average rate in the luxury segment with an 11% increase in January and February over 2014 results (RUB 15,200). At the same time, the increase in available rooms has reduced occupancy by 5% (to 47%). The drop in segment occupancy is less than expected and indicates that it has been a strong first two months for the luxury hotels – we can also align this growth to the fact that international travelers are now able to stay in higher level hotels for the same price in their local currency as they used to stay in a mid-market hotel a year ago. Upper upscale hotels have seen an 8% growth in occupancy whilst midscale hotels saw a drop of 4%.

Despite having increased online rates, all other segments have dropped ADR compared to the same time last year – by 5% across the board. This needs to be seen though in light of the fact that this time last year was not deemed as being ‘in crisis’ – we will need to see how rates catch up over the coming months – the more true comparison will be from Q2.

St. Petersburg

The second capital seems to be continuing the strong performance from last year – capitalizing on increasing local demand – though mostly for the upper end hotels. The city as a whole (including all main hotels) is on the same occupancy as this time last year (42%) – but the growth of occupancy in the luxury, upper upscale and upscale segments in the first two months has been an impressive 25%. ADR has grown about 8% in the luxury segment and is more or less flat elsewhere.

Krasnaya Polyana

This is the first commercial winter season following on from the Olympics in 2014 so it is very interesting to see how the mountain cluster of hotels has performed in these first two key months of the year.  January saw average occupancy of 58% and February was 71%. The previous year saw less occupancy in January as the Games were in prep mode (37%) and essentially the same occupancy in February (73%) – so the market has managed to perform the same one year after the Games – this is a positive result though of course one should wonder why the previous year was only 73% and not higher.

January was the strongest of the two months for ADR (RUB 7,800) – this would relate directly to the New Year holidays when hotel would have optimized prices. February was quite a bit lower at RUB 6,500. The stronger January performance means that year to date the hotels are up in RevPAR by 25% on last year.

Kiev

Kiev has seen a growth in occupancy of 8% in the first two months of this year. It is still lower than in 2013 and this increase has to be seen in relation to the events that were happening at this time last year in Kiev when occupancies dropped dramatically.

In terms of ADR – there has been a large drop in USD rates and this is due to the forex issues of the local currency. In February 2013 the rate to the USD was approximately 9 Grivna. In February 2015 it started the month at 16 and ended the month at 28 – hence dramatically reducing the ADR in hard currency terms (24% year to date).”


About JLL

JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual fee revenue of $4.7 billion and gross revenue of $5.4 billion, JLL has more than 230 corporate offices, operates in 80 countries and has a global workforce of approximately 58,000. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3.4 billion square feet, or 316.0 million square meters, and completed $118 billion in sales, acquisitions and finance transactions in 2014. Its investment management business, LaSalle Investment Management, has $53.6 billion of real estate assets under management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated.

In Russia and CIS JLL has offices in Moscow, St. Petersburg and Kiev. JLL, Russia & CIS was voted Consultant of the Year in 2004, 2006, 2007, 2008, 2009, 2010, 2011, 2012 , 2013 and 2014 at the Commercial Real Estate Awards, Moscow; Consultant of the Year at the Commercial Real Estate Awards 2009, St. Petersburg and The Best Real Estate Consultancy in Ukraine at the Ukrainian Property Awards in 2013.

For further information, visit www.jll.ua