With tourism growing, Israel looks to hotel innovation

As Israel prepares to host the second Israel Hotel Investment Summit (IHIS), part of the International Hotel Investment Forum (IHIF) series sponsored by Hotel Management's parent company, Questex, the current conditions in the region’s hospitality market, its strengths and the challenges to be addressed for a sustained performance are worthy of a closer look.


Tourism in Israel is booming. According to the Israel Ministry of Tourism, overnight stays increased in July and August  by 5 percent—a total of 1.66 million overnight stays—compared to the same period last year. Jerusalem and Tel Aviv were the most popular destinations netting 33 percent and 31 percent of overnight stays, respectively. 

Taking a broader view across the year from January to August, tourist arrivals to Israel increased by approximately 10 percent compared with 2018. Travel for religious purposes remains the highest motivating factors with backpackers and family travelers arriving in increasing numbers.


According to German travel site OMIO, Tel Aviv is ranked as the third most-expensive city in the world for tourists, behind Hong Kong and London. This statistic can impact international travelers as they consider destination options, and domestic tourism as Israelis regularly choose to travel outside their country for a better value tourism experience.

Demand drivers are essential for a sustainable tourism destination and form an integral part of an intelligent tourism strategy. While the Ministry of Tourism has set the ambitious target of welcoming 5 million tourists by the end of 2019 (2.6 million tourist entries had been recorded as of August), there remains neglect of a number of tourist sites across the country that observers say should be addressed and rectified in order to add to the plethora of attractions for tourists visiting Israel.


Israel could be referred to as “the land of enterprise and innovation” with concepts such as The Link Hotel & Hub in Tel Aviv by Dan Hotels providing all the hotel’s services through its app. Dan Hotels President/CEO Ronen Nissenbaum will attend IHIS next month and will present the opening keynote speech “Between Luxury and Innovation.”

Innovation across the Israeli hotel market extends beyond technology as the boom of the lifestyle concept is evident in offerings from Brown Hotels and The Norman in Tel Aviv. This design-led approach is permeating into the hostel markets with Selina offering a deeper connection with the world and Abraham Hostels creating a relaxed and affordable setting. There is a dire need for budget and mid-level accommodations throughout the country that is generating attention from international brands.

During Questex's The Annual Hotel Conference in Manchester earlier this month, Elias Hayek, partner/head of global hospitality and leisure, Squire Patton Boggs, said, “There is a lot of foreign capital waiting in the wings with Israeli money coming into the market.”

Additionally, during the International Hotel Investment Forum held in March this year, the audience was encouraged to look to Israel, as Israeli capital invested £2 billion in the U.K. in 2018 but to little fanfare. One investor said, “Israeli money is becoming a major player in the European Lodging industry.”

So, for all of Israel's allure, there remains a lack of accommodations and therefore opportunities for successful investment. 

For more information on the Israel Hotel Investment Summit taking place on the November 20 and 21 at the Hilton Tel Aviv, visit www.israelhotelinvest.com. IHIS is produced by Questex, parent company of Hotel Management magazine.