Lviv’s hotel market is experiencing changes in demand. Experts have investigated this impact
3 April 15:35
2024 was a period of significant change for the Lviv hotel market: Lviv lost part of its status as a business tourism city in favor of Kyiv. This is stated in the latest research of the hotel analytics service Hotel Matrix, informs
The decline in corporate and business bookings has led to a decrease in overall occupancy, which, despite active attempts to increase the average daily rate, could not fully compensate for these losses compared to last year. This is, in particular, the conclusion of the study.
What were the key performance indicators?
Assessing the key performance indicators of Lviv hotels, Hotel Matrix experts identified the following indicators:
1. Occupancy is the first of the three key KPIs of a hotel, which shows the percentage of rooms sold in relation to those available for sale for a certain period. In 2024, it amounted to 49% (against 52% in 2023, a decrease of 3%)
2. ADR (average daily rate) is another important indicator that provides information about the pricing policy applied by the hotel. In 2024, it reached 2785 UAH (vs. 2632 UAH in 2023, plus 5.8%)
3. RevPAR (revenue per available room) is one of the most common financial indicators that helps to assess how effective a hotel’s operations are. Last year, this income amounted to UAH 1375 (against UAH 1420 in 2023, minus 3.2%)
What the following indicators may indicate
First, changes in demand for Lviv hotels in 2024 clearly indicate a redistribution of flows. Lviv has lost some of its business tourism due to the reorientation of businesses to other regions, including Kyiv. A decline in corporate bookings and demand for long-term stays led to a decrease in occupancy compared to the previous year.
Secondly, despite the 5.8% increase in the average daily rate, it was not enough to compensate for the decline in occupancy. This indicates that Lviv hotels, although they were able to adapt their tariff policy, were unable to cope with the complete loss of customer flows.
Thirdly, the 3.2% decline in RevPAR (revenue per available room) in 2024, which is the main indicator of hotel performance, indicates that measures to cover the decline in occupancy are insufficient. The high level of the average daily rate could not compensate for the drop in occupancy, which confirms the importance of balancing between rates and sales.
Hotel Matrix experts stated that 2024 was a year of adaptation to new realities for Lviv, when the hotel market felt the effects of changes in the dynamics of customer flow, and advised Lviv hotels to review their strategies for 2025.
Kyiv hotel market grew in 2024
Last year, the capital’s hotel market demonstrated not just recovery, but structural growth with clear signs of stabilizing demand and improving tariff discipline. This was discussed in a previous study by the Hotel Matrix project.
As noted in the study, the occupancy rate of Kyiv hotels last year increased to 42% compared to 30% in 2023, and since the market remains active, the fight for guests will continue and will be even more interesting in 2025.
Hotel Matrix also announced reviews of the hotel market in Odesa and Bukovel.
Hotel Matrix is an online tool for analyzing the hotel business developed by experts from Poland and Ukraine. It allows you to analyze the market, compare the performance of a particular hotel with that of competitors, and, based on the data obtained, determine the development strategy of the respective hotel. The project was launched in May 2020 and currently involves 200 hotels.
By the way, according to the Hotel Market Review of Ukraine 2024, prepared by Ribas Hotels Group, even despite the negative impact caused by the hostilities, the number of hotels (plus 9.1%), motels (plus 10.7%), and hostels (plus 28.7%) grew in dynamics.
