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News Release

Moscow

Q3 2016 Sochi Quality Hotel Market Results: Comfortable and Ready to Face the Winter Colds


Moscow, 31 October, 2016 – JLL analyses the Q3 2016 quality hotels market results  in Sochi coastal and mountain clusters.

“In the middle of the year we said that the historically beloved Russian summer destination has been doing very well so far, notwithstanding the huge additional inventory – post-math of the Olympic games of 2014. Now September has marked the ending of the 2016 vacation season, and it is clear, that 2016 will be a year to be proud of, for this market.” – Tatiana Veller, Head of JLL Hotels & Hospitality Group, Russia & CIS, says.

Exemplary performances of both of the main clusters – downtown/sea and mountains – has extended past the calendar summer, and the month of September saw 63% of rooms occupied in the mountains, and 71% by the sea. Demand in the velvet season was supported by tourist groups, including some Asian travelers and MICE visitors.

“This gave the prices for accommodation stability, especially on the coast: there in September quality hotels sold rooms at average price of RUB 11,300, which is about the level for three summer months (RUB 11,900).” – Tatiana Veller says. – “September in the mountains was also not an exception in terms of the stability of ADR: from May the average price for a room here fluctuates around RUB 3,000, and it was 2,800 rubles in the first month of autumn.”

Year to date January through September, the occupancy in mountain cluster grew by 18 p.p. compared to last year and reached 57%, and with a 17% growth in ADR (to RUB 5,250), RevPAR bit the last year’s number by a whopping 70% (to RUB 3,000)!

Market players on the shore also didn’t fail to reap the benefits of the new travel patterns of the Russian consumers, and added 9 p.p. to the Q3 YTD Occupancy index vs. 2015 (resulting in 54% of room stock being sold), and the very healthy growth of 40% in the ADR (reaching RUB 10,300 per night). As a result, RevPAR grew to RUB 5,500.

​Q3 Sochi Hotel Market Results (YTD year-on-year)
Q3 Sochi Hotel Market Results_31102016.png


Source: STR Global, JLL

 “Now Sochi hoteliers are facing the mid-season – from now until the snow falls and ski tracks open in December, it should be a quiet time by the Black Sea. The professional operators, especially of the higher category hotels, are looking forward to the potential casino opening in Gorky Gorod in the beginning of January, hoping to receive incremental guest flows from that.” – Tatiana Veller concludes.


 * The analysis is based on STR Global data for quality hotels in upper segments.


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. A Fortune 500 company with annual fee revenue of $5.2 billion and gross revenue of $6.0 billion, JLL has more than 280 corporate offices, operates in more than 80 countries and has a global workforce of more than 60,000. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 4.0 billion square feet, or 372 million square meters, and completed $138 billion in sales, acquisitions and finance transactions in 2015. Its investment management business, LaSalle Investment Management, has $59.1 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, 2006-2016 at the Commercial Real Estate Awards, Moscow; Consultant of the Year at the Commercial Real Estate Awards 2009, 2016, St. Petersburg; Consultant of the Year at the RCSC Awards in 2015.