Recovery in the hotel industry: In the first 6 months 90 thousand square meters of hotel began to be built

Posted on Nov 6, 2022 by Ifi Reporter

After suffering a severe blow during the Corona period, data for the first half of 2022 indicate a continued recovery in the hotel industry, as far as the construction of new hotels and accommodation complexes is concerned.

The analysis of the data of the Central Bureau of Statistics (CBS) reveals that in the first six months of the year there was an increase in construction in this designation during this period about 90 thousand square meters of hotel and accommodation areas began to be built - a figure that reflects an annual construction estimate of about 180 thousand Mr.
According to real estate appraiser Yaron Spector, owner, and CEO of the Yaron Spector Appraisal and Real Estate office, which performed the data analysis for Ynet, this is an increase in the rate of construction of hotel and accommodation areas compared to 2021, when a total of 153,000 square meters were built for this purpose. It should be noted that last year a 5-year record was recorded in hotel and accommodation construction starts, after in 2017 construction of approximately 177,000 square meters began.
In 2020, the construction starts of hotel and accommodation areas were frozen due to the consequences of the epidemic - and reached the extent of only close to 54 thousand square meters. Spector points out that the construction for hotels in the first half constituted less than 1% of all construction starts during this period, but this is a figure that corresponds to the average In the last decade, according to him, so far only in 2012 was a record recorded in the rate of construction for hotels out of all construction starts - of 1.7%.
According to the data, Haifa is a leader in construction starts for hotels and hospitality in the first half of 2022, after about 47,000 square meters began to be built in this area. This is a jump compared to last year, when the construction of only 3,000 square meters began. It is followed by Eilat, where 28,500 square meters for hotels began to be built compared to only 816 square meters all of last year. In the north of the country, there has also been an increase in the construction of guest areas since the beginning of the year: in the settlement of Givat Yoav in the south of the Golan Heights, about 3,650 square meters have begun to be built. For comparison, in 2021 no construction of guest areas was recorded in the settlement, and in 2020 as a whole, construction of 35 sq.m. only.
The mayor of Eilat, Eli Lankri, explained the findings in the southern resort city: "In total, about 8,700 new hotel rooms are planned to be built here, which are in approved plans or in plans on deposit, of which about 6,000 rooms have already been approved in the master plan for the city for 2030, after not being built Hotels in the city for many years." According to him, "These days, 1,200 rooms are being built to serve 3 million tourists. Increasing the supply, while creating diverse and cheap accommodation options, is expected to affect the entire market."
The entrepreneur Yossi Abrahami, chairman and owner of the Yossi Abrahami Group, which is building, among other things, the Akoya Hotel from the YHotels chain on the coastline in Eilat, which includes about 100 guest rooms, added that "the surge in construction in the city is due to the maturation of hotel projects, the promotion of which began about two years ago, and is Part of the overall strengthening of domestic tourism in Israel, which has jumped significantly since the Corona crisis and the opening of the skies post-crisis - which has also brought tourists from abroad back to Eilat. Accordingly, real estate entrepreneurs recognized the returns that can be obtained from hotel properties, and companies seeking to spread risks also looked for new avenues of investment - and turn to hotels. In my estimation, the hotel sector in general and in Eilat in particular will continue to grow in the years to come, because it represents a great potential for entrepreneurs and investors."
In Jerusalem, the construction of approximately 3,200 square meters of hotel and accommodation areas began in the first half of the year. It should be noted that in the capital there is active construction of no less than 31,621 square meters of hotel and accommodation areas, the construction of which began last year. Tel Aviv is in fifth place in the list of the leading localities in the construction of hotel and accommodation areas, after the construction of 1,200 square meters began in the first half of the year for hotel purposes. In the city without a break there is a massive active construction of hotel and accommodation areas, after in 2021 the construction of 76,225 square meters began in this designation.


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