Europe -  Milan

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Milan is Italy’s second-largest city, the country’s business and financial centre, and a leader in technological and scientific research. The city is home to Italy’s stock exchange and one of Europe’s largest trade fair and congress venues. At the forefront of the international fashion and design scene, Milan is the preferred city for many national and international fashion and design companies to have their headquarters and it hosts several globally renowned events throughout the year, including Milan Fashion Week and the Milan Furniture Fair. The city is also strategically located with easy access to lakes, mountains and the coast, while also being a gateway to Europe. According to the ICCA, in 2019 Milan was 32nd in the world ranking of organisers of exhibitions and congresses, an impressive leap from the 42nd position the city held in 2014, demonstrating the robust upside resulting from EXPO 2015. Total passenger movements at Malpensa International Airport increased at a compound annual growth rate (CAGR) of 5.2% from 2009 to 2019. In 2022, Malpensa recorded 21 million passengers, representing a recovery to 78% of 2019 figures (26.8 million passengers). Linate Airport has moved from being strongly domestic-focused to having an increasing proportion of regional/international routes, with international travellers accounting for almost 70%. In 2022, Linate Airport recorded 7.8 million passengers, outstripping 2019 figures, which recorded 6.5 million passengers.

The market continues to be dominated by four-star hotels, which represent close to 60% of total room stock in the city. The five-year pipeline includes roughly 1,500 rooms due to enter the market, representing just over 5% of the current supply. The 12 projects range from the upper midscale to luxury positioning, have an average of 128 keys and the majority of them are expected to be operated or franchised under an international brand. Hotel performance has been on the rise in Milan for several years thanks to the boost instigated by EXPO 2015. RevPAR increased at a CAGR of almost 5.0% from 2014 to 2019. The 2020-21 performance reflects the adverse impact of the pandemic, with improvements noticeable from summer 2021 onwards. The performance in 2022 for Milan shows a bounce back after the pandemic, with room occupancy reaching almost 80% of pre-pandemic levels, and a healthy improvement in rate which brought RevPAR back to pre-pandemic levels in nominal terms. Looking ahead, Milan and Cortina d’Ampezzo will host the 2026 Olympics Winter Games, where 2,900 of the world’s top winter athletes will gather to compete for 114 medals. It is expected that the 2026 Winter Games should be another positive event for the market, both in terms of generating demand and creating further awareness.

Transactions in 2021 amounted to €332.6 million across seven properties (1,024 guest rooms). However, only three transactions were reported: the 106-room Park Hyatt in January 2021, the 55-room Hotel M89 in June 2021, which transacted for €7.7 million (€140,000 per key), and the 239-room Four Points Milan City Centre in December 2021. There was little transaction activity in 2022 in Milan. Trades included the sale of the NH Milano (65 guest rooms), the NH Milano Grand Hotel (100 guest rooms) and the ME Milan II Duca (132 guest rooms).

In terms of values, the strong demand recovery experienced from 2022 and the ongoing appetite for Italian hotel investment led to values growing by 7% in 2022, according to our 2023 European Hotel Valuation Index. This still places values some 6% below 2019 levels, but prospects for a full recovery for this market remain strong.

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: More than -10%

For more information, please contact:

Sophie Perret, MRICS, MBA
Managing Director
[email protected]
  • +44 0 2078787722 (w)
  • +44 0 7725781037 (m)