Occupancy of Tallinn hotels falls to 1.5 percent during pandemic

Tallinn. Source: Siim Lõvi /ERR

According to data from Benchmarking Alliance AB, whereas the average occupancy of the hotel rooms on the hotel market in Tallinn stood at 68.5 percent in April 2019, in April this year it had fallen to 1.5 percent.

The same decline happened in Estonia´s neighboring countries. Only in Stockholm, where mobility restrictions are not set and the internal tourism sector is bigger, has the indicator has stayed as high as 9.7 percent, declining from 61.2 percent.

The most important metric for the hotel owners concern she turnover of the accommodation service of one hotel room in the hotel market. In April, this fell from €47.16 to €0.67.

In Helsinki, the rate fell from €65.49 to €2.77 and in Riga from €45.79 to €1.01.

According to Jako Kapp, regional manager of Benchmarking Alliance Nordic AB Estonia, residents of neighboring countries need time to recover before they start traveling. He noted that the impact of the decision to open the borders between the Baltic States on the hotel sector is probably marginal so far. Fear of a virus outbreak in the face of a potential second wave also keeps people from traveling back.

Summer might see an uptick in domestic tourism just simply as coronavirus quarantine fatigue sets in further, he went on.

"People are tired of sitting at home and moving on one trajectory. Summer will bring some relief. It will give bread to the hotel keepers, but not sausage," Kapp added.

Kapp said that the previous business and conference clients, which had been the primary customers, will see a slow restoration in numbers.

"Many of the spring bookings were postponed to autumn. If we were to wait for all these bookings to be realized, then it could be pleasant but we can´t expect that," Kapp noted.

Airline companies are also careful with reopening their lines, which means a gradual restoration of tourism. "The other factor is people themselves, mentally," he noted, referring to people no being ready to travel.

Estonian hotels are mainly waiting for the reopening of the [maritime] border with Finland, as Finnish tourists usually fill about two-thirds of the hotels in the capital.

In addition, Kapp noted that Estonian hotels probably won´t start lowering prices as soon as possible to stimulate internal tourism. "Today, there are so few customers that bringing down the price will have no effect. Rather, when the recovery starts. It will hurt the whole market if we start playing with prices," he said.


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Editor: Roberta Vaino

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