The summer high season in Rio promises a 2023 recovery in Rio’s hotel industry, one of the sectors most affected during the pandemic.
Projections by the Rio de Janeiro Municipal Hotels Union (HotéisRio) point to the return of the average annual occupancy rate of hotels in the city of Rio de Janeiro, in the range of 70% next year, compared to an annual average of 65% that should be observed at the end of 2022.
Suppose the projection is confirmed based on reservations already made for New Year’s Eve and Carnival.
In that case, it will reach for the first time an average annual occupancy rate similar to the pre-pandemic, when it was around 75%, informed Alfredo Lopes, president of HotéisRio.
Executives from the hotel chains Fairmont, Promenade, Yoo/Intercity, Hilton, Windsor, and Hyatt were unanimous in projecting 2023 as a year of good performance for their business in Rio.
A combination of factors favorable to the sector led to optimism. The higher vaccination coverage against covid-19 has led to increased confidence for tourists to travel more, they detail.
At the same time, there is still pent-up demand, stemming from the more acute period of the pandemic, which stimulates personal and corporate travel – and, with it, more hotel stays, they ponder.
The high dollar against the real also makes Brazilians think more about traveling domestically, and Rio is one of the most desired destinations.
At the same time, the exchange rate makes the city more attractive to foreign tourists with the dollar in hand, they observed.
The hotel sector in the city needs a good performance after the pandemic, recognizes Lopes, citing that the total number of rooms in the capital fell from 62 thousand, before the pandemic, to the current 55 thousand rooms.
But at the end of 2022, the scenario is positive. Considering the reservations already made, the average occupancy in the capital was 89.61% from Dec. 30, 2022, to Jan. 1, 2023.
And for New Year’s Eve, the expectation of HotéisRio is almost 100% in some units. “This is not the ‘réveillon da virada’ for nothing,” said Lopes.
“Last year they said ‘don’t go to Copacabana’ [on New Year’s Eve, to avoid crowds]. And the samba school parades were postponed,” he recalls.
In 2023, both the New Year’s Eve and the carnaval party will be similar to what they were before the pandemic, he opines.
Michael Nagy, commercial director of the 375-room Fairmont Rio de Janeiro Copacabana hotel in Rio’s South Zone, agrees: “This is the first time I can remember in 20 years that I don’t have a room available for Carnival.”
And the trend is to continue with favorable occupancy, even with challenging factors. Nagy points out that all food inputs have risen more than 30% and that 2023 will feature income still without expressive recovery, in addition to other factors that inhibit consumption.
“But ‘the traveling market’ understands that if they’re not traveling out, they’re not spending as much,” he says, noting that the share of domestic tourists, at the Fairmont hotel, has grown from 22% pre-pandemic to 39% this year. “And [corporate] events are back.”
Emir Penna, director of the Promenade Group, also notes challenges for income in 2023. “But I see that this [possibility of lower rent] is not resonating in my bookings for the summer season.”
The chain has the 71-room Promenade Palladium in Leblon in the South Zone, and the 152-room Promenade Link Stay in the West Zone.
Penna celebrates occupancy averages in December, in the chain, which were between 80% and 90%. “We will have 100% [occupancy] on New Year’s Eve,” he says.
The chain’s projection is 30% higher sales in the high season – December to March -compared to the previous high season.
In turn, Alexandre Gehlen, general director of ICH Administração de Hotéis, expects to end 2022 with ‘revpar’ – revenue per available room – 18% above the pre-pandemic in 2019.
In the capital, ICH has the luxury hotel Yoo2, with 142 rooms in the South Zone, and the Intercity Porto Maravilha hotel, in the port region, with 225 rooms.
The company manages around 44 units in the country. Like the executives from the Fairmont and Promenade hotels, Gehlen observes that, at the end of the year, there are signs of a stronger return of foreign tourists to the city. “But it’s still ‘shy,'” he says, adding that this could improve.
In relation to this aspect, Laura Castagnini, general manager Brazil of the Hilton chain, recalls that there is greater ease of foreigners to get to the capital.
“There is a greater recovery of flights to the city of Rio [compared to last year, due to the pandemic], consequently we should have international tourist returning,” considers Castagnini.
This is already reflected in reservations.
“The ‘réveillon’ already presents higher demand than last year due to the international market’s resumption,” says Castagnini. His chain in the city is composed by Hilton Copacabana, with 545 rooms in the South zone, and Hilton Barra, with 298 rooms, in the West zone.
This context led Bianca Rodrigues, commercial manager of the Windsor Hotéis chain, to believe that 2023 will be “a great year”.
“We expect to close [New Year’s Eve] with 100% occupancy in all regions of Rio,” says the manager of the chain, with 15 units in Rio. “We have great expectations for summer, carnival and vacations.”
Alexandra Bueno, general manager of the Grand Hyatt Rio de Janeiro, with 436 rooms in Rio’s West Zone, is also optimistic.
“The indicators, in general, tend to show significant growth versus the same period of 2022, which was still very affected by pandemic,” she says.
“Our year-end revenue is about 40% higher compared to last year and almost 90% higher than in the pre-pandemic period.”
LA NIÑA EFFECT
For the second year in a row, La Niña is expected to delay the arrival of the summer high temperatures in Rio de Janeiro.
The climate phenomenon that reduces the temperature of Pacific waters will influence the weather until February, but begins to lose strength next month, when thermometers should begin to rise across the state.
The rainfall should be close to the average for the period, with slightly higher temperatures. The maximum temperatures tend to stay between 30 and 33 degrees.
The assessment is made by meteorologist Michelle Lima, from the Federal University of Rio de Janeiro (UFRJ).
“The trend of the beginning of summer should continue, but it doesn’t mean that we won’t have great sunshine and high temperatures,” she says.
For those who plan to start 2023 with their feet in the sand, the forecasts are good. According to Lima, there is a possibility of rain showers between the afternoon and the beginning of the night on the 31st, but it shouldn’t rain on New Year’s Eve.