The postponement of UEFA EURO 2020 leaves tournament hosts waiting another 12 months for desperately needed demand.
LONDON and BROOMFIELD, Colorado—Football fans across the world were expecting to be entertained this summer with UEFA EURO 2020 in June and July, but because of COVID-19, the tournament will now take place a year later in 2021.
Marking the 60th anniversary of the football European Championship tournament, UEFA EURO 2020 was slated to break the mold of only one or two countries hosting a tournament, with 12 cities across Europe playing host.
Historical performance: World Cup host cities
The last large-scale football tournament hosted in Europe was held in Russia, which hosted the 2018 World Cup, and it was perceived as a huge success globally and also a big winner in terms of hotel performance.
Russia certainly beat expectations when capital city Moscow scored year-over-year revenue-per-available-room growth of 214.0% for June and July in 2018. The large portion of this growth came from average daily rate, with rates growing 191.8% for the period and eclipsing previous key cities hosting the World Cup. Rio de Janeiro, host of the 2014 World Cup final match as well as other earlier matches in the tournament, posted a 94.2% growth in RevPAR for June and July 2014. Similarly, Johannesburg hosted the final in 2010 and recorded a 78.1% increase in RevPAR for June and July 2010, topping off a hat trick of phenomenal RevPAR growth for final hosting cities while also proving that RevPAR performance during large football tournaments is on the up.
Russia’s regional markets also benefited from the 2018 World Cup. Saint Petersburg and Sochi increased RevPAR at 13.3% and 20.8%, respectively.
The implications of a 12-month delay
As discussed in a previous article on the 2020 Tokyo Olympics, the move of such a large-scale event would bring a demand shift from what was expected in 2020 to the following year. However, it is unlikely we can expect to see the gains in performance of what was originally forecasted for EURO 2020 in a pre-COVID world.
Comparing what was forecasted in previous events helps to understand how the situation has developed and how it is expected to play out. Looking at the November 2019 and February 2020 editions of the forecast, occupancy and ADR were barely adjusted as in February we were only seeing COVID-19 take effect in China and parts of Asia, so both forecasts had the assumptions that the tournament would still take place in 2020. Given the fluidity of the COVID-19 spread, the March 2020 forecast edition factors in the outbreaks throughout Europe, and the 12-month delay for EURO 2020.
Diving into expectations for host cities
Dublin and London are typically compressed markets in the summer months, with Dublin’s aggregated occupancy for June and July dropping below 90% only once since 2014. Occupancy for June-July 2021 in Dublin is expected to reach 81.2% as it hosts four matches. Despite the tournament being hosted 12 months in the future, the impact from this pandemic will still be felt next summer as Dublin is heavily reliant on international arrivals, in particular U.S. travelers.
In London, aggregated occupancy for June and July is expected to reach 84.6%. These lower-than-usual occupancy levels do show EURO 2020 bringing some impact into 2021. However, due to the slower recovery of markets post-COVID, they are not expected to reach pre-COVID levels even a year later.
Over on continental Europe, the changes in the COVID-19 situation and how it has gripped Europe have been reflected in each update of the forecast. The most recent update forecasting for EURO 2020 in 2021 shows ADR to be at a lower level compared to previous editions, notably for those markets with a reliance in international arrivals. Munich is the least-impacted in ADR terms, this being thanks to a combination of starting at a lower ADR base, a biennial large-scale event returning in 2021, and the resiliency of the German economy.
The delay to EURO 2020 will only build up more anticipation for fans, and although the tournament may not bring as robust of a performance as expected, it will certainly still be a win compared to what will be a weak, COVID-affected 2020. The outcome from previous tournaments suggest this one will be a success in boosting hotel performance across the 12 host markets.
For insights into UEFA Euro 2020’s impact on hotel inventory, please check out the following article.
Christian Suarez is a Junior Analyst with STR’s Research & Analysis team, based in London. Claudia Alvarado is Analytics Manager with STR’s Consulting & Analytics team, based in Broomfield, Colorado.
This article represents an interpretation of data collected by STR, parent company of HNN. Please feel free to comment or contact an editor with any questions or concerns.