Five-star gazing

According to data of the Polish Central Statistical Office [GUS], there were only 75 hotels that could officially claim to be of a five-star standard in Poland at the end of May 2019. That’s actually not so many considering that we have 2,900 accommodation buildings registered as hotels. “This is less than 3 pct of all the hotel buildings, although there are also those that have not yet been categorised. However, they meet all the criteria stipulated by the hotel categorisation act in force in the country,” remarks Andrzej Szymczyk, the director of the hotel department at Walter Herz. “Unfortunately, the act is somewhat outdated and no longer in line with the latest trends and requirements of guests, hence hotels in the highest category can vary in terms of quality. Most of them are quality facilities in terms of their architecture, staff and operations, but there are also those at the other end of this scale,” he adds.

The shortage of high-class hotels in Poland is partly our own fault because supply follows demand, according to the laws of the free market. “In my opinion, the low number of hotels of this type that we have in Poland is down to one basic reason – the minuscule demand for high quality services, compared to that for the entire market, as a result of the higher prices,” adds Andrzej Szymczyk.



Agata Janda, associate director of the hotel advisory at JLL

Why pay more if you can’t see the difference?

The difference in the interiors of four- and five-star hotels is, mostly, not visible, especially in Poland. This will probably change with the launch of such brands as Four Seasons and Autograph Collection. So far, the only observable difference is in the quality of the guest service. “Unfortunately, five-star Polish hotels run by global brands often pale in comparison with their counterparts abroad. This is very much a consequence of the lower prices paid by guests in Warsaw compared to, say, Paris – PLN 1,000 instead of EUR 1,000, which is a big difference. Especially if we take into account what this amount has to cover in terms of the hotel’s expenses,” explains Andrzej Szymczyk of Walter Herz. In one example, a guest of a five-star Polish seaside hotel was expecting the same service he had experienced in a hotel of the same brand in another country – one that followed the guest step-by-step. However, he was unable to pay more than EUR 200 per night, although previously he had paid EUR 1,200 per night in the hotel abroad. “In Poland we are faced with the problem of how to define a ‘luxury hotel’, which a five-star hotel should undoubtedly be. Unfortunately, buildings that are far from luxurious in terms of their quality, their fittings and not to mention their service are often considered to be luxury hotels,” admits Andrzej Szymczyk. New five-star hotels are being developed in Poland all the time. One by the Nosalowy Dwór group is currently under construction in Zakopane. Meanwhile, Mgallery by Sofitel is soon to open in Wrocław, while Autograph Collection hotels are being developed in Warsaw and Kraków. There is also talk of a Four Seasons opening in a building being developed by BBI in Warsaw, as well as of the return of Hyatt Regency to Poland – this time, opening in Kraków rather than Warsaw, as well as the debuts of Tribute Portfolio, Aloft and Wyndham, although the latter three are still of the subject of speculation. “Most luxury hotel chains would like to enter Poland, but the costs of acquiring the right property and adapting it to the needs of a bona fide five-star brand are quite large compared to the returns that can be obtained in the form of hotel revenues. However, I believe that we will be hearing of the confirmation of brands entering that are considered to be the crème de la crème of the hotel sector over the next few years. Still, these will be individual cases rather than a flood of truly exclusive hotels,” says Andrzej Szymczyk.



Andrzej Szymczyk, associate director in the hospitality department at Walter Herz

Robert de Niro’s waiting

There are also those on the market who are saying that this is not entirely a real estate issue, but more about the development of the entire country – its cities, infrastructure and the economy as a whole. One hotel market expert, who wishes to remain anonymous, told us that luxury hotels simply require strong markets where there are high prices, with busy international airports and branches of the largest investment banks. “Hotels of the best global luxury brands could appear in the country, but not in the next few years. Investors will only decide to introduce such brands to Poland when average prices per night rise. They are still not high enough in Poland and Central and Eastern Europe,” explains our source, who has worked on the hotel market for many years. Such hotels are appearing in spite of the obstacles already mentioned, although these are currently individual undertakings. One of the most anticipated hotel investments in Poland that will undoubtedly be counted among the most exclusive hotels in the country, is Nobu in Warsaw, which is being developed by Tacit Investment to a design by the Medusa Group studio. This fashionable global brand, which includes among its founders the actor Robert de Niro, will be making its Polish debut in the former Rialto hotel on ul. Wilcza and will also feature a Nobu restaurant. “Importantly, Warsaw and Kraków are of interest to other ultra luxury global hotel brands, and their expansion into these cities is being hampered only by access to suitable sites. It is worth emphasising that Poland is also becoming more and more attractive for the kind of high-class lifestyle hotel brands that are well known in London and New York. The first few ‘private members club’ concepts will also be launched in our country soon,” reveals Agata Janda, the director of the hotel consultancy at JLL.

So what are we still waiting for? From what we have heard in Poland, we would like – but perhaps at the moment these amount to nothing more than pipe-dreams rather than anything based on the real market – a Ritz Carlton hotel to open, or maybe even better, a Bulgari (Marriott International) or a Fairmont (Accor Hotels), or an even a Waldorf Astoria (Hilton) or a Kempinski hotel. Well, wishful thinking aside, let’s look what’s available right now. The most expensive hotel in Poland currently is – and this will probably not come as any surprise – Accor Hotels’ Raffles Europejski Warsaw, which opened last year. “It’s a top-class global brand and undeniably the most exclusive hotel in Poland,” insists Agata Janda, the director of hotel consulting at JLL. At Raffles, you have to pay at least PLN 1,000 a night for a double room, while the 235 sqm Raffles Suite will set you back more than PLN 17,000 in the high season. The Warsaw Bristol has slightly higher prices, but it doesn’t have such a large and elegant apartment suite and thus the average price for a stay is slightly lower. The largest available apartment in the Bristol is ‘the Paderewski’ with app. 110 sqm. A night in it costs around PLN 8,000 in the high season. In addition to the Raffles and the Bristol, the list of luxury hotels in the Polish capital was added to last year by the reopening of the Likus family’s extensively renovated Hotel Warszawa in the former Prudential building, where a night costs around PLN 800. Prices of around PLN 1,000 per night for a double room are not the exclusive reserve of the capital city since they can also be found in Poland’s top seaside resort – Sopot. According to JLL, guests who book a Saturday night in the Grand Hotel (Sofitel) or Sheraton in the holiday season should be prepared for such expenditure. Rooms are priced a little less at the Radisson Blu in Świnoujście, which is one of the largest seaside hotels, comprising 340 rooms and an extensive spa zone. By comparison, a stay at the Radisson Blu in the seaside town of Rostock in Germany or in Klaipėda in Lithuania would be around half that price. However, prices in Polish coastal resorts do drop by at least a half out of season. At the Sopot Sheraton you can pay just PLN 500 per night for a booking in November. In Kraków, the most expensive hotel is the Copernicus, which is also owned by the Likus family and one of two hotels in Poland that from part of the portfolio of exclusive global brand Relais & Chateaux. A weekend stay in the Copernicus during the summer period costs PLN 850 per night.

The Hotel Bristol, a Luxury Collection Hotel in Warsaw (managed by Marriott International)

The price of low prices

Hotel prices in Poland are still among the lowest in our region but much of this is specific to the country – unlike the Czech Republic or Hungary, which each have just one strong hotel centre: Prague and Budapest, respectively. Poland, has Warsaw for business, and for tourists it has Kraków and the TriCity. “The demand is spread across different markets and is seasonal. New hotel concepts, however, are bringing with them new quality and strengthening Poland’s position on the European hotel map. It is becoming a more attractive destination for international and local tourists. As a result, we will be seeing the openings of better and more expensive hotels, but this doesn’t mean that it will become less affordable to stay here. Together with the proliferation in the premium segment, the budget segment is also set for some dramatic growth. And this will be more justified commercially on those markets where high prices are the rule,” predicts Agata Janda of JLL. ν