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HVS In-Depth Europe Hotel Valuation Index:   2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | 2007 | 2006 | 2005 | 2004 | 2003 | 2002 | 2001

Within Rome’s 1,285 km² area and population of 2.7 million (2021) lies Vatican City, the only existing example of a country within a city and the seat of the Pope, thus attracting large numbers of religious tourists. Key economic sectors in Rome are tourism, industry (oil and gas) and fashion. It is the fourth most important fashion centre worldwide and the home of the European ‘Hollywood’, Cinecittà Studios. In 2022, Rome ranked as the fifth-most-visited city in Europe and the country’s most popular tourist attraction. It is also the seat of several United Nations agencies. According to the ICCA, in 2019, Rome was 13th in the world ranking of organisers of exhibitions and congresses, up from 22nd position in 2018. Rome is served by Rome Fiumicino (Leonardo da Vinci) International Airport where international passenger movements increased at a CAGR of 4.5% from 2009 to 2019. The passenger statistics for 2022 showed a strong return following the pandemic, serving 32.8 million passengers, 66% of the 49.4 million passengers served in 2019. Rome Ciampino International Airport (a mainly budget airline hub) is a secondary airport of the city and experienced a CAGR of 2.5% in passenger numbers over the same period. Recent statistics show that there were 3.4 million passenger movements in 2022, up 49% on 2021 numbers mainly thanks to the return of international visitation.

Rome’s hotel supply increased at a CAGR of 1.7% from 2012 to 2020. In 2020, three-star hotels dominated the offering by ‘number of hotels’ (37%), followed by budget hotels (35%). In terms of room supply, four-star hotels have the biggest capacity, providing 50% of Rome’s total rooms. Much of Rome’s upper-end hotel stock is of only ‘reasonable’ quality, as strong demand has historically made reinvestment in the properties’ fabrics a low priority from owners’ perspectives. However, new supply and investor interest are pushing towards renovating and improving the overall quality of the supply in the market. The five-year pipeline of 16 schemes accounts for 2,850 rooms, or 6.7% of the current supply. Most of these properties (31%) are classified as midscale to upper upscale, the minority (6.3%) as economy and 25% as luxury. Included in these is the 95-room Six Senses Rome (opening in March 2023), the 160-room InterContinental Rome (March 2023), the 95-room EDITION Rome (April 2023), the 157-room Rosewood Rome (June 2024) and the 110-room Bulgari Hotel Roma (June 2026).

Occupancy pre-pandemic oscillated around the 70s mark marketwide. Average rate increased at a CAGR of 2.5% from 2014 to 2019, signifying an inflationary RevPAR CAGR of 1.1%. The blow to Rome’s RevPAR was in the region of 85% in 2020 and the impact remained strong in 2021, with the RevPAR still recording a 70% decrease compared to 2019. Rome showed continued recovery in 2022, with demand volumes back to 80% of 2019 levels and solid average rate growth that placed RevPAR just above 2019 figures in nominal terms. Rome’s strength lies in it being a strong leisure destination, in a stable country, with significant qualitative appeal. Its dependency on international visitation (circa 60% of arrivals in 2019) was one of the reasons for this strong performance in 2022, as US visitation to Rome is key. This should allow for future growth within the market as international travel returns fully, notably from China.

Given the post-pandemic investor interest in Italy (and Southern European markets in general), the level of transactions in Rome remains somewhat low. Two hotels were sold in 2021 (down from three in 2020 and eight in 2019): the 132-room Grand Hotel de la Minerve, expected to be converted by 2023 into an Orient Express hotel, and the 101-room Hotel Londra and Cargill. A further five hotels were sold in 2022: the 57-room Hotel Alexander (undisclosed amount), the 162-room W Rome (€172 million), the 100-room Hotel Majestic, the 181-room Giustiniano Imperatore and the 75-room Hotel Guilio Cesare, in which the transaction prices were not published.

Rome’s hotel values increased by 6% in 2022, as per our HVI analysis, recovering at a similar rate to Milan. This is still around 7% below 2019 levels, but further rate growth for this market, where supply improvements are still ongoing, should continue to support value recovery in the years ahead.

ADR, Demand, Occupancy, RevPAR, and Supply Projections:

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Market Supply Growth

Change In Value For Market: (€Euro)

Rome RevPAR Change (€Euro)

Rome RevPAR (€Euro)

For more information, please contact:

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