Hotels & Accomodations

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Significant trends that have emerged in the recent decades are:

i. Rebound and Growth: The hotel and hospitality industry is not expected to make a full recovery until 2024 after being devastated by the coronavirus pandemic, reported by US News. More than 670,000 hotel industry operation jobs and nearly 4 million hospitality jobs were lost in 2020 due to the pandemic. Statista projected that the revenue of the Hotels market will reach US$446.5 bn by 2024 worldwide. Looking forward, an annual growth rate of 3.32% (CAGR 2024-2028) is expected, resulting in a projected market volume of US$508.9 bn by 2028. 

ii. Tech Integration: AI is reshaping travel and tourism by introducing efficiencies across a wide range of operations and elevating the guest experience to new heights. AI can analyze vast amounts of data quickly and efficiently, extracting valuable insights to drive decision-making and improve guest experiences. 

iii. Sustainability Focus: Eco-conscious travel and green practices are increasingly demanded by guests. Hotels and restaurants are adopting sustainable operations, sourcing, and waste management to appeal to environmentally conscious customers.

iv. Experience-Driven Travel: The Travel Lingual insight reported that in 2024 travelers are expected to prioritize unique experiences over material possessions. This signals a 65% increase in spending on travel experiences compared to a 12% increase in material possessions in March 2024. ‍

v. Evolving Workforce: Over the past two years, the industry’s biggest challenge has not been attracting customers but rather finding and retaining staff. Hospitality companies will invest in improving the overall employee experience, offering competitive benefits, career development and training opportunities, recognition programs, and fostering a positive work culture, mentioned in Typsy blog. 

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Hotel & Hospitality Industry Growth

The hotel & hospitality industry witnessed remarkable growth, surging from $4,390.59 billion in 2022 to $4,699.57 billion in 2023, marking a notable compound annual growth rate (CAGR) of 7.0%. This growth trajectory instilled optimism, particularly among hoteliers eagerly anticipating positive signs amid challenging times. As the travel industry gears up for a robust comeback in 2024, there's a promising outlook for hoteliers. Projections indicate a surge in room demand, expected to reach an all-time high in the coming year. According to STR, global hotel occupancy is forecasted to increase by 2.5%, accompanied by a 4.1% growth in the hotel average daily rate (ADR) over the next 12 months. Despite facing setbacks due to the onset of the coronavirus (COVID-19) pandemic in 2020, the hotel and resort industry's global market size demonstrated resilience. After experiencing disruptions, the industry regained momentum in 2022 and Statista forecasted it to reach a substantial $1.21 trillion U.S. dollars by the end of 2023, underscoring its enduring potential for growth and adaptation.

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The hotel market in Bangladesh is indeed expected to experience significant growth. By 2024, the revenue in this market is projected to reach US$1.17 billion, Based on the projection of Statista. This growth is attributed to an increase in domestic tourism and investment in infrastructure. The annual growth rate from 2024 to 2028 is projected to be 5.14%, resulting in a projected market volume of US$1.43 billion by 2028.

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In terms of user penetration, the number of users in the Hotels market is expected to amount to 12.68 million users by 20281. The user penetration rate is projected to hit 7.0% by 2028, up from 6.2% in 2024. The average revenue per user (ARPU) in the hotel industry in Bangladesh is expected to be around USD 109. 

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There are many segments based on the type of hotel, the target market, and the services offered. Each segment caters to a specific type of customer and has its own set of requirements:

Luxury: The luxury hotel segment in Bangladesh is represented by international chains like Radisson Blu Dhaka Water Garden and Le Meridien Dhaka. These hotels offer high-end amenities and personalized services.

Upscale: Upscale hotels in Bangladesh include the likes of Dhaka Regency Hotel & Resort and Radisson Blu Dhaka Water Garden. They blend comfort, convenience, and value-added services for both business and leisure travelers. 

Midscale: Midscale hotels such as the White Palace Hotel offer practical and affordable options for budget-conscious travelers. They provide a balance between cost and comfort.

Economy: Basic accommodation at the most competitive prices and services (e.g., Lake Shore)

Boutique: Unique and stylish hotels with distinct local character and personalized experiences.

Extended Stay: Apartments or suites designed for longer stays, often featuring kitchens and laundry facilities. (e.g., Maple Crest, Rafflesia)

All-Inclusive: Resorts offering accommodation, meals, drinks, and activities within a single price package. (e.g., The Palace Luxury Resort)

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Largest Hotel Chains in Bangladesh

The hotel chains offer a variety of services and cater to different segments of the market, including business travelers, tourists, and locals looking for luxury accommodations:

Unique Hotel & Resorts Ltd: As the leading hotel chain, Unique Hotel & Resorts Ltd. boasts around 20 properties. This group is known for operating several brands across different categories, providing a diverse range of hospitality experiences to guests.

Best Western Hotels & Resorts: With 14 properties, Best Western Hotels & Resorts is a significant player in Bangladesh's hospitality scene. The chain includes hotels under the Best Western and SureStay Plus brands, catering to a variety of guests with different preferences.

Pan Pacific Sonargaon Hotel: Standing as a singular iconic luxury hotel in Dhaka, the Pan Pacific Sonargaon Hotel offers an exclusive and upscale hospitality experience. It represents a unique offering in the market with its singular focus on luxury.

Radisson Hotel Group: The Radisson Hotel Group, with 4 properties, including the Radisson Blu and Park Inn by Radisson brands, provides a mix of luxury and mid-scale options for travelers. This diversity ensures a wide appeal to various market segments.

Le Méridien Dhaka: Le Méridien Dhaka is an upscale hotel in Dhaka, offering a singular, sophisticated experience. As a lone property, it stands out for its unique brand of luxury and service excellence.

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The horizon of Bangladesh's hotel industry gleams with promise, forecasting a 5.14% growth from 2024 to 2028, soaring to a market volume of US$1.43 billion by 2028. Embracing the digital tide, online sales are set to surge, comprising 62% of total revenue, as the industry sails towards a tech-savvy future. Despite the tempest of COVID-19, resilient strides are evident, buoyed by governmental support of Tk1,000 crore in the FY 2022-23 budget. Amidst this dynamic landscape, ten opulent five-star hotels are poised to grace Dhaka and Chittagong, answering the crescendo of demand. Both domestic and international tourism in Bangladesh are expected to grow. The number of users in the Hotels market is expected to amount to 13 million users by 2028. Additionally, Statista forecasted that the number of international tourist arrivals in Bangladesh is forecast to continuously increase between 2024 and 2029 by 0.2 million arrivals (+56%). With a flourishing domestic tourist scene and the allure of international travelers, the hotel sector awaits a crescendo of occupancy, scripting a captivating narrative in Bangladesh's tourism tapestry. 

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