Europe -  Munich, Germany

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In recent years, Munich has consistently earned top marks from leading business journals and institutes as a business location. This is reflected in the city’s economic indicators, such as low unemployment and high GDP growth. Munich’s economic importance and strength within Germany is founded on several important pillars: the diverse economic structure, the wide range of growing industries and the successful composition of global players and SMBs (small- and medium-sized businesses), which all offer substantial growth opportunities. Munich is Germany’s leading city in the sectors of IT and communications technology, media, finance and life sciences. The city has also risen to prominence as a cultural and artistic centre, benefiting from many attractions, including several festivals with international appeal.

The above factors contribute to strong leisure and corporate demand, but the city also benefits from strong MICE demand. As with any major MICE destination, the performance of this segment is dependent on which biennial or triennial events are held in the city in any given year; overall, however, Munich typically sees 1.7-2.4 million MICE visitors a year. BAU (the world’s leading trade fair for architecture, materials and systems) and BAUMA (the world’s leading trade fair for construction machinery, building material machines, mining machines, construction vehicles and construction equipment) are the two most important MICE events for the city. BAU occurs every two years and BAUMA every three, meaning both occur in the same year every six years.

Munich has benefited from impressive tourism growth in the past decade. As per the latest available statistics, 2017 saw a continued strong increase in visitor numbers at 10.2% year-on-year, derived from healthy growth in both domestic and international visitation. Munich’s relatively even split between international and domestic demand, and the good balance of corporate, leisure and MICE demand, provides continued confidence in Bavaria’s capital.

The cyclical nature of the MICE market must be considered when analysing growth trends. Although 2017 had the benefit of the BAU trade fair, it recorded a decrease in both occupancy and average rate, as a result of new supply and the terrorist attacks in Germany and other parts of Europe. As the 2017 misfortunes have been managed and demand re-established, Munich’s hotel market experienced healthy RevPAR growth in 2018, mainly driven by average rate growth, whilst occupancy averages remain above the mid-70s. As a result, overall hotel values in Munich increased by around 5.7% in 2018. Munich remains one of the strongest hotel markets in Germany. Given its good market liquidity, the recent expansion of the Munich Messe centre and with the planned addition of a third runway at the airport due to open by 2025, we expect long-term performance to continue to improve.

Considering all the projects in the planning, construction and preopening phases, there are currently more than 7,000 additional hotel rooms due to enter the market by the end of 2023, deriving from properties ranging from budget to luxury.

For Munich, the most recent key transactions include the Hotel Pullman Munich, Holiday Inn Munich City Centre, and the Hampton by Hilton München City Centre East, which all materialised in 2017.

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%

For more information, please contact:

Sophie Perret, MRICS, MBA
[email protected]
  • +44 20 7878 7722 (w)
Magali Castells
[email protected]
  • +44 20 7878-7710 (w)
  • +44 7 850205149 (m)