Europe -  Istanbul, Turkey

Istanbul is Turkey’s most populous city and the country’s cultural and financial centre. The city’s hotel market benefits from a variety of tourist attractions, such as the Grand Bazaar, the Aya Sofya (Church of the Divine Wisdom) and the Sultan Afmet Mosque (the Blue Mosque), amongst others, which attract leisure demand. Additionally, the city attracts both domestic and international corporate travellers. The Levent and Maslak financial districts are home to the headquarters of Turkey’s largest companies and banks, as well as the local headquarters of global giants in the financial sector such as, Citibank, Merrill Lynch, JP Morgan, HSBC and many others. Consequently, Istanbul benefits from being a MICE destination as well as a cultural attraction.

Currency dynamics continued to have a significant impact in 2017, wherein Istanbul made a dual appearance in both the top five (local currency) and bottom five (euro) in our index. In a local currency analysis, Istanbul recorded positive hotel value growth. Following a severe RevPAR decline of more than 40% in 2016 – owing to a combination of terrorist attacks, Turkey’s involvement in the civil war in Syria and its unstable relationship with Russia – 2017 was a year of recovery. The return of Russian tourists (as the flight ban was lifted) and cheaper currency boosted the demand to Istanbul, leading to a recorded RevPAR growth of more than 30% compared to 2016. Although Istanbul has experienced some recovery, there is still a long way to go before reaching its peak levels in terms of hotel values. Overall, these are certainly not the most desired conditions in terms of foreign investment in hotels, although the pipeline for 2017 is still substantial. However, it remains to be seen how much of the pipeline will become operational.

Finally, owing to the current tense and unstable situation, the number of hotel transactions in the city has understandably decreased, with no major single asset or portfolio sales since 2010.

Change In Value For Market: (€Euro)

Significant Value Increase: Greater than +10%
Moderate Value Increase: Between +3% and +10%
Stable Values: Between -3% and +3%
Moderate Value Decline: Between -3% and -10%
Significant Value Decline: Less than -10%

Istanbul RevPAR Change (€Euro)

Istanbul RevPAR (€Euro)

For more information, please contact:

Sophie Perret, MRICS, MBA
[email protected]
  • +44 20 7878 7722 (w)
Simon Hulten
[email protected]
  • +44 020 7878-7775 (w)