Focus on Italy: Olympic efforts set to pay off

There are a few worried voices coming out of the International Olympic Committee that Italy won’t be ready to host the Winter Olympic and Paralympic Games in 2026, assigned jointly to Milan and Cortina d’Ampezzo. Construction work hasn’t meaningfully started on the main infrastructure projects, and according to media reports, tentative offers have arrived from St. Moritz in Switzerland and Innsbruck in Austria to host the bobsleigh, should the track mooted for Cortina not materialise. Meanwhile, the Palaitalia ice hockey venue destined for Milano Santa Giulia is still largely on the drawing board, with costs now estimated at 40 percent higher than planned. Only one segment of the economy seems to be ahead of schedule: the hospitality industry.

Perhaps unsurprisingly, the private sector sees tremendous opportunity in the tourism projections for the Olympics – some 1.7 million visitors, according to tourism association Confturismo – requiring a significant increase in beds plus upgrades to the 87,000 hotel rooms currently available in Lombardy and Veneto. Continuing the growing love story between international capital and Italian hospitality, several flags have already been planted.

Family run

“Most of the supply in Cortina has traditionally been dominated by family-run hotels,” notes Claudia Bisignani, head of hotels and hospitality at JLL in Italy, “as is the case historically in Italian hospitality. But the entrance of a few players is changing all that.” Following the reflagging of Cortina’s Grand Hotel Savoia under the Radisson brand, San Domenico Hotels, led by Aldo Melpignano, took over the historic Hotel Impero, converting it into the minimalist, wood-lined Hotel de Len with 22 keys. San Domenico is also in talks to secure another hotel in the area. Meanwhile, the historic hotel Cristallo closed last year, and will be reborn as a Mandarin Oriental in 2025, with a refurb and expansion taking its 74 keys to 83. There’s even talk of Soho House opening a Cortina branch, after the membership chain debuted in Rome in 2021 and laid plans to launch in Milan.

Hospitality Investor is a media partner for the upcoming Italian Hospitality Investment Conference (ITHIC). The event takes place in Rome between 19 and 20 October. You can buy tickets here.

Another international player which has Cortina in its sites is Greek private real estate investment and asset manager Invel, which acquired Hotel Bellevue Suites & Spa in 2022. Alexis Pipilis, one of Invel’s acquisition chiefs, notes that the Italian authorities have made it easier to expedite refurbishments and developments in light of the timeline, often one of the bottlenecks in launching hotels in the country. “A special planning regime is being introduced to allow the redevelopment of older stock to cater for the Games,” he says.

Although Bellevue’s central chalet dates to 1894, and the hotel names the likes of Ernest Hemingway amongst its historic patrons, Invel will be permitted to pull down some of its more tired elements and start over. “We are most likely going to demolish much of the existing structure and create a highly sustainable new-build constructed out of wood. Sourcing local materials, the hotel’s rooms will be built into the side of the mountain to create a truly unique project,” Pipilis says.

But what if the sporting structures aren’t ready, and the Games moves elsewhere last minute? Bisignani is confident that things will all come together, even if it may be tight. “We were behind with the Milan Expo, and not only completed the preparations in time – it was a huge success,” she says. “Expo marked the renaissance of the city of Milan and its hospitality infrastructure, which pivoted to a business and leisure offering, rather than just being seen as a city of business. The Olympics will mark the next phase.”

Boom year

It's hard to argue against this assessment, considering the last, incredible 18 months experienced by Italy’s tourism sector.

“We have seen a tremendous, renewed interest in the four main markets, Rome, Florence, Milan, and Venice, both from visitors and investors and operators willing to gain representation in Italy,” affirms Bisignani. “This has been matched by a real attempt to reliquefy the hotel stock which has traditionally been under family ownership. This happened in Spain a few years ago, and  it is now Italy’s turn.”

In terms of supply, according to JLL figures, Italy currently numbers around 32,500 hotels with around million keys; each structure has an average of 35 rooms. While a significant majority are budget hotels, this is shifting rapidly. “We’ve seen a 7 per cent growth year-on-year of four-star properties, and a similar growth in the last 12 months of five-stars. But the number of luxury properties has leapt in total by 57 per cent over the past five years,” she notes. 

And all signs suggest that further growth potential remains. Growing interest in the regions beyond the four main cities, including Puglia and Lake Como, as well as the expansion of Sicilian destinations, is inspiring international capital and operators to go where they haven’t gone before. On top of that, there will be plenty to do in Italy’s primary destinations.

Rome’s ambitions

Rome is already gearing up for its Jubilee year, 2025, when around 35 million tourists and pilgrims are expected to descend on the city. An infrastructure spend of some €2 billion is focusing on this deadline – including the completion of Metro C stops for the Colosseum and other central locations – while the city has unveiled pedestrianisation plans to link Vatican City with Castel Sant’Angelo.

A recent press conference at the Campidoglio, Rome’s council house, saw Rome’s councillor for major events, sport, tourism and fashion, Alessandro Onorato, underline that Rome’s success at welcoming visitors in the Jubilee year would inspire confidence in its other bids. The capital is also seeking to host Expo 2030, which could generate another 30 million visitors,  using former gladiator Russell Crowe as the face of the bid and winning backing from the likes of Brazil. Onorato says that “Rome has recovered the appeal it had lost”.  He adds: “Major events, such as the Ryder Cup, the arrival of the Giro d'Italia and the Skate World Championships contribute to new tourist flows and generate work and investments. Rome has a lot of funds, and we have the opportunity, thanks to the Jubilee and the PNRR [Italy’s national investment plan] to make up for lost time.”