The luxury hotel industry has seen a significant drop in tourism, resulting in large losses. Due to lockdowns across the globe, travel suffered and because of that the tourism industry almost came to a standstill.
International as well as domestic tourists limited their travel because of fear of contracting COVID-19. One of the most important factors for the downturn in the hospitality industry is the drop in tourist activities all over the world.
However that is now changing with countries around the world slowly opening up. Luxury hotels demand in 2022 is projected to be strong.
This demand will come from the growing middle class and increasing disposable incomes across Asia, Middle East and Africa. The Middle East region still has a low penetration of luxury accommodations with only 2% of total hotel rooms being five star or higher in 2017 according to STR Global’s Hotel Construction Pipeline report. This compares to an average of 17% in Europe and North America over the same period (2016-2020). Despite this, there are high expectations for growth as regional oil revenues continue to increase and tourism infrastructure improves. In order for these regions to sustain their current rate of economic development, they must diversify into industries that require more sophisticated products such as luxury hotels.
The major players in industry of Luxury Hotels Market are InterContinental Hotels Group PLC, Jumeirah International LLC, Starwood Hotels & Resorts, Kerzner International Resorts, Four Seasons Holdings Inc., Shangri-La International Hotel Management Ltd., ITC Hotels, Marriott International, Mandarin Oriental International Limited, and The Indian Hotels Company Limited, among others.
The luxury hotels market accounted for USD 11.24 Billion in 2020 and is expected to reach more than USD 14.40 Billion by 2028, growing at a CAGR of 3.5% from 2021 to 2028.