Hamburg is one of Germany’s most attractive hotel locations with a beautiful harbour, lots of cruise ship events, international congresses and cultural highlights making it a veritable tourist magnet. The market holds huge potential for more congress and conference hotels with favourable prospects for new projects, according to a market analysis in the run-up to MIPIM. All these aspects will be highlighted when the world’s leading property market gets underway in the French Riviera town of Cannes from March 14-17, 2017.
More new builds planned
Hamburg’s latest landmark, the Elbphilharmonie with The Westin hotel is attracting more investors and the city holds even more potential. Dr Rolf Strittmatter, Managing Director of Hamburg Business Development Corporation (HWF), noted: “In January, the Elbphilharmonie was opened in Hamburg as one of the most spectacular concert halls in the world atop a former port warehouse. By adding a modern glass structure to the old red brick of the old 'Kaispeicher’, the landmark building today acts as an architectural symbol of Hamburg’s future viability. It increases the attractiveness of Hamburg for visitors and is a strong driver of demand in the hotel industry.“ More new hotels are being planned targeting especially business travellers.
Focus at MIPIM
A total of 16 hotels with around 2,300 rooms such as the Holiday Inn Hamburg in City Nord, the trendy Sir Nikolai boutique hotel and the five-star hotel, The Fontenay, owned by the logistics entrepreneur Klaus Michael Kühne, are set to open in Hamburg this year. Strittmatter, who is also Managing Director of Hamburg Marketing GmbH, added: “We are optimistic about 2017 and expect one or two investors’ decisions on congress and conference hotels in Hamburg. We will not be revealing locations, projects and operators today.”
Hamburg will thus be eyeing even more hotel investors in Cannes. The Hanse city’s joint stand at MIPIM will host 24 companies and institutions. Dr. Dorothee Stapelfeldt will represent the senate and highlight urban development in the Hanse city as HafenCity Hamburg nears completion and other new projects are being developed. They include Altona’s new centre to the A7 motorway canopy, Hamburger Deckel, and HamburgOst – both of which are likely to change the image of the city and raise urban quality.
Highest hotel occupancy in Hamburg
Hamburg is one of the most attractive locations for hotel investors in Germany, said Colliers International commercial real estate brokers. The city boasts the best key hotel characteristics in Germany after Munich. Constant growth and ongoing demand reflect the positive developments in Hamburg’s hotel market.
Last year, around 6.6 million guests accounted for 13.3 overnight stays in Hamburg, according to the latest figures by Hamburg Tourismus GmbH. This came to growth of 5.5 per cent or 692,000 overnight stays over 2015. Hamburg has thus higher growth than the average 2.6 per cent across Germany. Compared to other German cities, Hamburg is witnessing the strongest rise in demand.
Last year, four new hotels with around 520 rooms opened in Hamburg. Room occupancy averaged 79.6 per cent (+1.4 per cent) in 2016 putting the city ahead of Berlin (77.1 per cent) and Munich (75.9 per cent). The average price of a room rose 5.2 per cent to EUR 115 bringing the revpar to EUR 92 (+6.7 per cent) in Hamburg. The ongoing, dynamic growth has prompted the city to support the need-based, increased capacity in the hotel sector.
Potential in MICE sector
However, Hamburg still has to catch up in the Meetings, Incentives, Conventions und Events (MICE) segment. Conferences and congresses generate around a quarter of overnight stays in Hamburg and nearly EUR 660 million in added value. Speaking during a recent panel discussion on Hamburg as a hotel location, Christoph Eichbaum, Manager of Ernst & Young Real Estate GmbH, pointed to a lack of hotels for the classic business travellers to the city in contrast to the budget segment which has seen plenty of investment in recent years.
Apart from the superlative of the Elbphilharmonie, the European XFEL is launching an unrivalled, scientific project from Hamburg. Scientists from all over the world are now invited to apply for experiments at the European X-ray laser XFEL. The joint project involving eleven countries with a financial volume twice that of the Elbphilharmonie will create the basis for new discoveries, new insights into disease processes and advanced energy research. Further research institutes, especially the Fraunhofer Society, are currently being founded or expanded. These developments are likely benefit the entire hotel sector.
Elbphilharmonie and other cultural highlights
Growing demand for hotels can be seen against the backdrop of the first concerts at the Elphilharmonie, the international “Theatre of the World” festival (May 25-June 11, 2017) that is being held again in Hamburg for the first time since 1989. This year’s other cultural highlights include the Hamburg Cruise Days (September 8-10, 2017) with record ship numbers and the Blue Port light installation. The Reeperbahn Festival and the NEXT digital conference will attract many international music fans from September 20-23, 2017.
Meetings and congresses
Last year, Hamburg successfully hosted the key OSCE conference and will follow it up with the major G20 summit of heads of state in July 2017. And the list of business events this year is long with the Seatrade Europe 2017 Cruise & Rivercruise Convention, which is key to the Hamburg Cruise Days, the Online Marketing Rockstars with its exhibition and congress regularly attracts 25,000 visitors to the city. The Congress of the German Diabetes Society will be held in May and Hamburg will also host the d3con – the world’s biggest programmatic advertising event – this year.