Baltics: The tourism sector is performing exceptionally well in all three Baltic states, boosting the results of hotels operating in the region as well. In the past five years, the number of tourists accommodated at hotels increased by 18% in Estonia, 58% in Latvia, and 40% in Lithuania, with the capitals hosting the majority of the flow.
Tallinn: The strong results for hotels support new projects in the pipeline. Geographical closeness to northern countries and convenient connections via Tallinn seaport should keep the tourist flow steady and fuel the most advanced hotel market in the region in the future. Under their global expansion, Radisson Red and Hampton by Hilton chose Tallinn as a debut destination in the Baltics. This will be a significant addition to three and four-star hotels in the next four years.
Riga: In recent years, the impressive growth in flows of tourists into Latvia has lifted Riga above Tallinn, making it the top tourism destination in the Baltics. Tourist flows and somewhat sluggish new development boosted results for hotels. Multiple tourist attractions and easy connection via the region’s dominating airport should support hotel market performance in the near future. In 2020-2023, the market could see the opening of 6-10 new hotels, including well known brands such as Holiday Inn by IHG among them.
Vilnius: The Vilnius tourism market is significantly smaller than its Baltic peers. However, the city is catching up with new projects being delivered and existing ones being expanded or refurbished. Strong growth in 2018, when 830 new rooms were added to the market, has marginally affected occupancy rates negatively, but it should start improving again soon after the adaptation period. In 2020-2023, the market could see the opening of 8-12 new hotels.