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News Release

Moscow

Minsk Hotel Market Overview


Moscow, 20 October 2014 - JLL Hotels & Hospitality Group is glad to present the Minsk Hotel Intelligence report.

Minsk is the capital of Belarus. The key business partner continues to be Russia. As a hotel market it is mostly corporate guests from Russia and the CIS region, as well as a degree of casino related business. Only a minor segment of demand comes from tourism, and tends to be individuals and groups who stop off on a tour than includes Kiev and Moscow. 

“80% of hotel guests are from Russia and CIS countries. Over 75% of this demand is corporate or governmental. There has been minimal annual growth in the last 5 years – no higher than 3% annually. The city held the World Ice Hockey Championships in 2014 – it failed to drive further tourism but drove hotel supply,” – David Jenkins, Head of JLL Hotels & Hospitality Group, said. – “It has been traditionally hard to develop in Minsk. Today there is a new Renaissance opened (operated by Interstate) as well as a franchised Crowne Plaza.”

“From a market that as of 2013 had one branded hotel of 151 keys, by 2018 there could be as many as 14 branded hotels with 2,500 keys (Kempinski, Hyatt, Marriott, Hilton, Doubletree by Hilton, Hampton by Hilton, Novotel, Mercure, Holiday Inn and others in process). This will dramatically change the face of the city in hotel terms and severely saturate the market for many year to come. Two-thirds will be within the upper segments – clearly a significant challenge.” – David Jenkins commented.

It is not yet a fully transparent market with most hotels being partly or wholly owned by or affiliated to the local authorities. We are starting to receive initial data which flags concerns already of oversupply as a result of the drive to build rooms for the hockey. According to JLL estimations, occupancy in Minsk sits at 40% with ADR at USD135.

“It is hard to be positive in terms of hotel performance going forward given the almost unbelievable pipeline in place. We are urging caution to anyone looking to enter the market to allow it time to stabilise. It is not a dynamic market and is heavily reliant on Russia so we do not see any sudden boom in activity to satisfy such an increase in supply.” – David Jenkins concluded.


Please find link to the report​