With a inhabitants of greater than 930,000 , the capital metropolis of Amsterdam lies on the coast of the province of North Holland. The metropolis – identified for its historic canals, the well-known Van Gogh Museum, the Rijksmuseum, and the espresso outlets of the Red Light District – can also be a big monetary and enterprise centre in Europe. There had been greater than 3,500 worldwide firms within the Amsterdam Metropolitan Area (AMA) in 2023, representing greater than 30% of the private-sector jobs. The metropolis is extremely accessible through native, nationwide and worldwide transport hyperlinks. Amsterdam has glorious home and worldwide connections through Amsterdam Schiphol Airport, the European high-speed rail community and the North Sea Canal.
Economic Indicators – The Netherlands
Tourism Demand
Amsterdam has traditionally been one of many primary tourism locations in Europe. Between 2010 and 2023, town’s visitation grew by 4% every year, on common, with greater than 75% of the guests being worldwide. In 2023, the first worldwide feeder markets remained an identical to the pre-pandemic years, with the UK (13%), the USA (11%), Germany (10 %) and France (5%) being liable for practically 40% of inbound visitors. The home market accounted for 21% of whole visitation, reaching 117% of the pre-pandemic ranges of 2019. After a extreme drop in visitation in 2020 owing to the pandemic, visitation picked up barely in 2021 however really began to recuperate in 2022, following the raise of the journey restrictions in March.
Having reported a rise in points linked to overtourism lately, Amsterdam raised town tax to 12.5% in January 2024, aiming to cut back the variety of cruise ship arrivals and alter the profile of tourists coming to town. This technique is turning into more and more fashionable in European cities dealing with the identical downside, reminiscent of Barcelona and Venice.
Visitation and Accommodated Bednights
Hotel Performance
In 2018 and 2019, the Amsterdam market noticed wholesome progress in each occupancy and common charge, attaining document RevPAR ranges, earlier than plummeting by roughly 80% throughout COVID.
Despite a sluggish begin to 2022, the market skilled a speedy restoration following the lifting of restrictions in March. Owing to a drastic improve in occupancy (+40 proportion factors) and an equally spectacular progress in common charge (+55%), the market’s RevPAR quadrupled year-on-year. Maintaining this momentum in 2023, RevPAR elevated by 35%. Despite reaching pre-pandemic ranges in nominal values for the primary time, final 12 months’s RevPAR was nonetheless a few proportion factors behind 2019 in actual phrases. We spotlight that our knowledge pattern leans extra strongly in direction of the higher finish of the market, as mirrored within the higher-than-average room charges.
Key Metrics
Hotel Supply
Hotel room provide elevated at a compound annual charge of 5% from 2014 to 2023, with roughly 3,200 new rooms since pre-pandemic instances. Total resort provide presently stands at round 42,000 rooms and is usually concentrated within the mid- and upscale segments (roughly 75%). The upscale phase witnessed the best compound annual progress charge between 2014 and 2023, at round 8%.
The preliminary ban imposed on new resort developments within the Canal District in 2015 led to deliberate initiatives relocating to peripheral areas. However, to additional enhance tourism move and restrict overtourism within the metropolis, town of Amsterdam applied additional restrictions on new resort development on the finish of 2016. These restrictions primarily prohibit the event of resorts throughout the metropolis centre; sure initiatives, largely throughout the IJ river, can nevertheless nonetheless be accepted. This understandably had a drastic impact available on the market’s pipeline.
Hotel Pipeline
Investment Market
Amsterdam’s resort funding market has all the time been one of the crucial engaging markets in Europe, with a considerable variety of transactions going down lately. Notable transactions from 2022 onwards embrace the sale of the 93-room Mercure Amsterdam Centre Canal in January 2022 (€520,000 per key) by AccorInvest to Ascott Ltd; the 288-room QO Hotel Amsterdam, offered by CBRE IM and Invesco UK to Tristan Capital Partners for €92 million in May 2022; the acquisition of Accor’s stake within the 178-room Sofitel Legend The Grand by Schroders (€840,000 per room); and the 111-room Hoxton resort, acquired by Schroders in December 2022 from Ennismore Capital for greater than €540,000 per room. Two transactions occurred in March 2023. The 52-room Hotel Atlantis was purchased by Dutch owner-operator Highland Group for round €9.5 million (€180,000 per room). The future Maison ELLE was bought by Extendam for an undisclosed quantity. For the newest worth developments, please discuss with our annual European Hotel Valuation Index, which showcases the year-on-year worth progress of resort belongings in key markets, together with Amsterdam.
Hotel Transactions
Outlook
The Amsterdam market was vastly impacted by the pandemic and the next strict authorities restrictions. Following the weak efficiency throughout 2020 and 2021, a modest restoration began in Q2 2022, constructing momentum for the drastic enchancment showcased in 2023. Although final 12 months’s RevPAR was nonetheless marginally under pre-pandemic ranges in actual phrases, town’s attractiveness – coupled with well-diversified demand sources and a restricted provide – point out a promising 2024 and, probably, the market’s full restoration. The metropolis’s method to manage over-tourism stays essential to watch, its impact on the excessive season remains to be to be analysed. Nonetheless, Amsterdam stays one among Europe’s most coveted resort markets, standing behind solely Paris, London and Zürich in our European Hotel Valuation Index.
