Spanish Hotel Market: Resort Destinations

Christie & Co’s latest market report has just been published, analysing 14 of the most relevant holiday destinations in Spain: Costa Brava, Costa de Barcelona, Costa Daurada, Costa de Castellón, Costa de Valencia, Costa Blanca, Costa Cálida, Costa de Almería, Costa Tropical, Costa del Sol, Costa de la Luz-Cádiz, Costa de la Luz-Huelva, Canary Islands and Balearic Islands.

Spanish hotels registered a total of 105.3m arrivals in 2018, of which 43.4% (45.7m) went to hotels located in resort areas of Spain. Demonstrating the strong performance of the areas commonly known as “sun and beach” destinations, Christie & Co has released a new report looking at 14 resort destinations from the Mediterranean and Atlantic Coasts (including the Balearic and Canary Islands).

For the last five years, these destinations have benefited from the instability of their Mediterranean competitors (Turkey, Tunisia and Egypt), and have experienced a strong recovery with record figures in demand, supply and profitability. The resort hotel sector has become one of the main drivers of tourism growth in the country, accounting in the last two years for the largest volume of hotel investment in Spain (65% of investment in 2017 and 64% in 2018, as covered Christie & Co’s annual Spanish Hotel Investment Overview).

The 14 destinations analysed in the report (Costa Brava, Costa de Barcelona, Costa Daurada, Costa de Castellon, Costa de Valencia, Costa Blanca, Costa Calida, Costa de Almeria, Costa Tropical, Costa del Sol, Costa de la Luz-Cadiz, Costa de la Luz-Huelva, Canary Islands and Balearic Islands) accumulated 220.6m overnight stays last year, representing 64.8% of the total number of overnight stays in Spain in 2018 (340.2m).

The report analyses the economic, touristic and hotel framework for each of the areas, highlighting the special relevance of both the Balearic and Canary islands, and the Costa del Sol; the three main holiday markets in Spain in terms of RevPAR (in 2018, the Balearics reached €87.73, the Canaries €80.47 and Costa del Sol €72.09) and occupancy (83.63% in the Canary Islands, followed by 78.70% in the Balearic Islands and 74.70% in Costa del Sol). However, the three destinations identified which reached the highest average price (ADR) are the Balearic Islands (€111.50), Costa de la Luz-Cádiz (€104.60) and Costa del Sol (€96.50), leaving the Canary Islands in fourth pace with an average price of €96.26 in 2018.

The report also offers analysis of the feeder markets in all 14 destinations, how seasonality affects them or the average stay length, reviewing their development in recent years. Likewise, the report analyses both current and future offerings in these holiday destinations and their evolution. In addition, the report dedicates a special appendix to the Canary Islands, the Balearic Islands and Costa del Sol, offering a brief look on the most important locations in those destinations.

Joan Bagó, Market Analyst at Christie & Co and author of the report, comments: “Demand growth and the improvements in the quality of the hotel supply have allowed hotels to increase ADR by +5.5% (CAGR 2014-2017), boosting performance by +6.9%. Nevertheless, in 2018, we note for the first time in five years a stabilisation in the number of overnight stays, which has affected occupancy (-2.7%) and consolidated RevPAR levels (+0.1%).”

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Author: Christie & Co