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News Release

St. Petersburg

St. Petersburg Hotel Market Update. Q1 2014 Results


​St. Petersburg, 16 April 2014 – JLL’s Hotels & Hospitality group announces the Q1 2014 St. Petersburg hotel market results.

“The mood was strong and positive in St. Petersburg following a very good 2013 for all hotels. Overall Q1 in city was not as disappointing as it was in Moscow, though following on from a year (2012) where RevPAR was up in all segments from 15% and upwards – any drop can be seen as a loss of momentum.” - David Jenkins, Head of Jones Lang LaSalle’ Hotels & Hospitality Group, Russia & CIS, said. – “The worrying trend in the city is the slow-down in summer bookings that will potentially lead to more severe drops as the year progresses – knocking the city back again after a very encouraging last 18 months or so of continuous growth.”

According to JLL’ Hotels & Hospitality group, St. Petersburg luxury segment although gaining 6% in occupancy lost the same in ADR so is so far flat to Q1 last year. All other segments dropped occupancy. The main movements from Q1 last year were the upscale segment (down 6% in occupancy with flat ADR) and midscale with a drop of 4% occupancy but a slight rise of 2% in ADR. The other segments were mostly flat in performance to last year.


St. Petersburg Hotel Market in details

Luxury

A fall in ADR of 6% has been balanced by a growth in occupancy of the same percentage. “We now see renovations in the Grand Hotel Europe – new restaurant wing and new suites – due to open later this year to present a product to compete for higher ended suite business with the Four Seasons. Q1 has seen no influence on the hotel figures of the political issues – this is more likely to be seen in the summer months.” – David Jenkins commented.

St. Petersburg Luxury Segment Q1 2014 (year on year)


Source: STR Global, JLL


Upper Upscale

The upper upscale segment managed to grow RevPAR at 2% in the first quarter, continuing on from a good performance in 2013 although at a much slower pace. It is clear that the growth evident in last year may not be sustainable this year now.

St. Petersburg Upper Upscale Segment Q1 2014 (year on year)


Source: STR Global, JLL


Upscale

“A poor January was followed by a flat February and a dip again in March. The upscale hotels generate a good percentage of business from corporate guests and it will be hoped that this can help them if there is indeed a drop in summer bookings.” – David Jenkins mentioned.

St. Petersburg Upscale Segment Q1 2014 (year on year)


Source: STR Global, JLL


Upper Midscale

So far this segment is performing flat to the same period in 2013. It is of course a disappointment following the strong growth shown last year but illustrates the difficulty to grow year on year.

St. Petersburg Upper Midscale Segment Q1 2014 (year on year)


Source: STR Global, JLL


Midscale

The slight growth in ADR (+2%) has led to a similar drop in occupancy in this segment; again an indication of strong price sensitivity at this level in the market.

St. Petersburg Midscale Segment Q1 2014 (year on year)


Source: STR Global, JLL


“Being more of leisure based market, St. Petersburg is already feeling some pressure in terms of a slower pick-up on summer bookings. We do expect the impact of the current political situation to be felt hardest in the second capital as it is a market based mostly on group and high-end international leisure – the very segment that turns away first.” – David Jenkins said. – “We do though expect hotels to look at new markets such as China and the Middle East – though it will also depend on the ability of the key travel houses to replace any lost US and European business. There has though been a growth in late of domestic tourism, especially weekend business from Moscow, so we expect to see hotel continuing to push this side of their business.”


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 revenue of $4.0 billion, JLL operates in 75 countries worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 279 million square meters and completed $99 billion in sales, acquisitions and finance transactions in 2013. Its investment management business, LaSalle Investment Management, has $47.6 billion of real estate assets under management.

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 and 2013 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.ru