Europe -  Rome

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Within Rome’s 1,285 km² circumference and population of 2.9 million (2019) lies the 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 2019, Rome ranked as the 16th-most-visited city worldwide and the country’s most popular tourist attraction. It is also the seat of several United Nations agencies. According to 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 and domestic travel at a decline of 1.2%. 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, mainly thanks to international visitation growth.

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’ (37.0%), followed by budget hotels (35.0%). In terms of room supply, four-star hotels have the biggest capacity, providing 50.0% of Rome’s total rooms. Much of Rome’s upper-end hotel stock is only of ‘reasonable’ quality, as the strong demand makes reinvestment into the properties’ fabrics a low priority from owners’ perspectives. However, new supply may pressure existing hotels into renovating and consequently improving the overall supply quality in the market. The five-year pipeline of 16 schemes accounts for 2,200 rooms, or 3.1% of the current supply. Most of these properties (56.3%) are classified as midscale to upper upscale, the minority (6.3%) as economy and 37.5% as luxury. Included in these is the 95-room Six Senses Rome, the 110-room Bulgari Hotel Roma, the 157-room Rosewood Rome, the 95-room EDITION Rome and the 160-room InterContinental Rome.

Occupancy in recent years has been 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. Going forward, 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 60.0% of arrivals in 2019) both signifies a challenge during times of travel restrictions, but also holds promises in terms of the rate ceiling in the near future. Rome’s hotel values increased by 4.5% in 2021, as per our HVI analysis, recovering more slowly than Milan and Florence. 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.

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: More than -10%

For more information, please contact:

Sophie Perret, MRICS, MBA
Senior Director
[email protected]
  • +44 20 7878 7722 (w)
  • +44 0 7725781037 (m)
Nikola Miljković
Associate
[email protected]
  • +44 0 2078787724 (w)
  • +44 0 7593572865 (m)