The terrorist attack in Istanbul on the morning of January 12, 2016, resulting in 10 victims of foreign nationalities, is another tough blow to the tourist industry of the city and country. All the more so since it took place in the neighborhood of Sultanahmet, where the two most visited monuments in Turkey are located: the Hagia Sophia and the Blue Mosque. But while some impact in the future is to be expected, the country's security situation had already begun to affect it 2015.
On the whole of 2014, close to 40 million visitors went to Turkey, generating some 34 billion dollars in revenues and and bringing the country into 6th place among international tourist destinations. This position in the ranking is currently at risk of changing as the German government has asked its nationals, which represent the destination's leading source market, to avoid high traffic areas. Local professionals are currently remarking about the multiplication of cancellations.
The leading tourist destination in the country, with 11.8 million travelers in 2014, Istanbul is also the first victim of this backdrop of insecurity. And yet, the city stood out for the strong dynamism of its tourism and hotel industry, as monthly data published by MKG Hospitality show.
Monthly change in hotel results in Istanbul since 2013 (comparison with the same month the previous year)
In 2014, Istanbul's hotel properties were able to maintain a good level of occupancy (68.4%) despite strong growth in the supply at the destination, that led to a drop by 2.3 points in the indicator with respect to 2013. 11.9% growth in the Revenue per available room (RevPAR) in 2014 could thus be accounted for by the 15.6% increase in the average daily rate, although part of this increase is due to the opening of upscale hotels and palaces.
The following year, hotel activity was more marked by the geopolitical security context of the country. Although properties in Istanbul were able to bring their occupancy rate up by 2.5 points between January and November 2015, the indicator began to fall during the recent months, when the tension could be more felt in the country. The 9% drop in average daily rate (in local currency) on the period should be put into perspective with the simultaneous drop by 10% in the exchange rate of the Turkish lira against the euro in 2015, which emphasizes the down trend from a point of view of European investors. The RevPAR of Istanbul's hoteliers thus showed a drop by 5.6% between January and November 2015, but by 10% on the last 3 three months (in local currency), due to a drop in occupancy rate (-4.8 points on the last three months).
While the impact of previous terrorist attacks on tourism and hotel activity in Istanbul could be increasingly felt in recent months, the murderous act on January 12 dealt another blow to the sector. Today, professionals are more concerned about the evolution of their activity in the months to come, although in the mid term Turkey will remain one of the major emerging markets for the global hotel industry.
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