Since the collapse of the Soviet Union, there has been great growth in the Moscow hotels industry. In fact there has been an explosion of growth since the year 2000, and new hotels continue to come in. Despite this explosive growth, however, the Moscow hotels industry continues to lag behind many of their European counterparts.
31.08.2007
Since the collapse of the Soviet Union, there has been great growth in the Moscow hotels industry. In fact there has been an explosion of growth since the year 2000, and new hotels continue to come in. Despite this explosive growth, however, the Moscow hotels industry continues to lag behind many of their European counterparts.
In September of 2006 TRI Hospitality Consulting found that in one area, however, Moscow hotels are the cream of the crop: profitability. According to the survey run, hotels in Moscow are the most profitable to be found anywhere in Europe, even despite the fact that their per room revenue is only fourth on the list for Europe. By paying their workers exceedingly low wages they have managed to create a situation of very high profitability.
As Moscow in general continues to grow and become more popular not only for tourism but also for business travelers, the Moscow hotels industry is going to need to continue to grow in order to meet increasing demand. Room shortages have not been uncommon in recent years, with demand exceeding the supply of rooms in the city. As of 2005 there were only 5,000 hotel rooms in Moscow among its 170 hotels. This is in comparison to 11,000 hotel rooms in Paris and 37,000 hotel rooms in London, two of the other major destinations in Europe.
These limitations in terms of space have allowed the Moscow hotels industry great power in asking high prices for their rooms: in fact Moscow has become and continues to be one of the most expensive cities to visit in all of Europe.
One of the keys to development in the Moscow hotels industry is foreign investment, of which there is plenty already under way. One example of this would be the recently completed Ritz Carlton Moscow, right next to Red Square and the Kremlin. It boasts some of the most spectacular views in the city, but also claims one of the highest costs in the city: rooms start at well over $800 USD a night (over 20,000 RUB a night).
An area where the Moscow hotels industry particularly lacks is that of budget hotels. Budget wary travelers can find it difficult to find cheap accommodations in Moscow, with even the less expensive hotels often having rates beginning well over $100 USD a night. While high prices lead to both increased revenue generation and increased profitability (especially when coupled with the incredibly cheap labor employed in Moscow hotels), it cuts out on a potential market that could increase overall Moscow tourism.
Despite its problems, the Moscow hotels industry continues to grow. It has placed itself among the most successful and profitable hotel industries in all of Europe, but continues to lag behind some of its peers in some areas. Moscow must continue to develop new hotels and add new rooms to existing hotels in order to meet increasing demand for rooms in the city. Much of this development is already under way, but there is still much more to be done in the Moscow hotels industry.
Moscow Hotels Industry: Ways to Develop
Since the collapse of the Soviet Union, there has been great growth in the Moscow hotels industry. In fact there has been an explosion of growth since the year 2000, and new hotels continue to come in. Despite this explosive growth, however, the Moscow hotels industry continues to lag behind many of their European counterparts.
In September of 2006 TRI Hospitality Consulting found that in one area, however, Moscow hotels are the cream of the crop: profitability. According to the survey run, hotels in Moscow are the most profitable to be found anywhere in Europe, even despite the fact that their per room revenue is only fourth on the list for Europe. By paying their workers exceedingly low wages they have managed to create a situation of very high profitability.
As Moscow in general continues to grow and become more popular not only for tourism but also for business travelers, the Moscow hotels industry is going to need to continue to grow in order to meet increasing demand. Room shortages have not been uncommon in recent years, with demand exceeding the supply of rooms in the city. As of 2005 there were only 5,000 hotel rooms in Moscow among its 170 hotels. This is in comparison to 11,000 hotel rooms in Paris and 37,000 hotel rooms in London, two of the other major destinations in Europe.
These limitations in terms of space have allowed the Moscow hotels industry great power in asking high prices for their rooms: in fact Moscow has become and continues to be one of the most expensive cities to visit in all of Europe.
One of the keys to development in the Moscow hotels industry is foreign investment, of which there is plenty already under way. One example of this would be the recently completed Ritz Carlton Moscow, right next to Red Square and the Kremlin. It boasts some of the most spectacular views in the city, but also claims one of the highest costs in the city: rooms start at well over $800 USD a night (over 20,000 RUB a night).
An area where the Moscow hotels industry particularly lacks is that of budget hotels. Budget wary travelers can find it difficult to find cheap accommodations in Moscow, with even the less expensive hotels often having rates beginning well over $100 USD a night. While high prices lead to both increased revenue generation and increased profitability (especially when coupled with the incredibly cheap labor employed in Moscow hotels), it cuts out on a potential market that could increase overall Moscow tourism.
Despite its problems, the Moscow hotels industry continues to grow. It has placed itself among the most successful and profitable hotel industries in all of Europe, but continues to lag behind some of its peers in some areas. Moscow must continue to develop new hotels and add new rooms to existing hotels in order to meet increasing demand for rooms in the city. Much of this development is already under way, but there is still much more to be done in the Moscow hotels industry.