Europe -  Lisbon, Portugal

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Lisbon benefits from excellent links by road, rail, sea and air. Portela International Airport is just seven kilometres from the city centre and lies within the city limits. The Port of Lisbon is the busiest on the European Atlantic coast, and it has three berths for cruise ships. The city also has marinas for private boats at various docks, an expanding rail network and an underground (metro) system. Road access is also deemed excellent. Lisbon’s hotel market shows a fairly strong seasonality pattern due to a predominant leisure segment, given the more favourable weather conditions compared to many other European cities. The high season runs from April to July and resumes in September and October. Historically, Lisbon gained substantial recognition by hosting the Expo 98, the 2004 European Football Championships (the largest sporting event in Portugal’s history) and the EU presidency in 2007. A major inducer of demand is Rock in Rio Lisboa, one of the biggest pop/rock festivals in the world, with an attendance of roughly 350,000. The event, originally planned for June 2020, was postponed due to COVID-19 and is now expected to take place in June 2021. The Web Summit and Fish & Flavours Lisbon are other key demand inducers. The city hosted the 2020 UEFA Champions League quarter-finals, semi-finals and the final in August 2020. However, the matches did not generate real additional demand as they were played behind closed doors.

Since 2013, more than 5,100 hotel rooms have been added to the market, and according to Turismo de Lisboa, Lisbon had 223 hotels in 2020, providing some 22,600 hotel rooms. The city’s five-year pipeline of 48 projects is substantial, at 22.0% of the existing rooms. Over the past 10 years, occupancy grew from the mid-60s to the mid-70s in 2019, reaching just below 80.0% in 2017, before reducing slightly over the next two years due to supply growth and more subdued visitor growth. Meanwhile, Lisbon’s average rate performance increased significantly over the past five years, growing at a compound annual rate of 6.5%, resulting in a RevPAR CAGR of more than 7.0% over the same period. In 2020, Lisbon’s RevPAR collapsed by more than 83.0%, a loss somewhat more pronounced than those of its European neighbours.

Hotel asset transactions in Lisbon in 2019 included the 163-room Hotel Exe Liberdade and the 146-room DoubleTree by Hilton Lisbon Fontana Park, which transacted for €23 million and €38 million, respectively. In addition, a portfolio of three hotels, including the 119-room Avani Avenida Liberdade, the 306-room Tivoli Avenida Liberdade and the 279-room Tivoli Oriente, was acquired by Invesco Real Estate from Minor International for around €313 million. More recently in 2020, however, only four properties transacted in Lisbon, all as part of the Bernardino Gomes portfolio, for a total volume of €36 million. The assets traded include the 24-key Residencia Apartamentos Turísticos, the 147-key Hotel Real Palácio, 153-key Hotel Real Parque and the 75-key Maxime Hotel. Our 2020 HVI analysis indicates that hotel values in Lisbon declined by 17.1% in 2020 over the previous year.

Change In Value For Market: (€Euro)

Legend
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%

For more information, please contact:

Sophie Perret, MRICS, MBA
[email protected]
  • +44 20 7878 7722 (w)
Nikola Miljković
[email protected]
  • +44 20 7878-7721 (w)
  • +44 7 593572865 (m)