With the semi-finals concluded and the final two teams decided, the pace of flight searches is increasing dramatically, along with matching price hikes. With limited time before the most prestigious prize in club football kicks off, we examine how London's hospitality market is faring.

Madridistas and Dortmunders create a surge in flight demand

The final has come down to two of the biggest clubs in European football, the yellow and black of Germany’s Borussia Dortmund and the famous all white of Spain’s Real Madrid.

Now the finalists are locked in, fans are searching hard for flights, with our Flight Search Evolution Index soaring for London queries.

As of the time of writing two weeks out from the final, searches are nearly four times the average level in the Index over the next six months and more than 120% higher than the average volume being made over the next two months.

It should be no surprise that the leading search country for flights is now Spain, followed by Italy and Germany. This reflects the relative size of the two clubs’ fanbases, as Real Madrid are the biggest name in global club football in this regard, with thousands of fan clubs, millions of followers in Spain and hundreds of millions worldwide.

Borussia Dortmund are no slouch in terms of fan base either, with a famously devoted following that has allowed the club to sell more season tickets than any other in the Bundesliga, but it can’t quite compare.

This likely lies behind Germany accounting for 7% of all flight searches, compared to the 10% coming from Spain.

Plenty of fans are leaving their hotel bookings to the last minute

While there is a significant increase in flight searches, hotel searches have not seen a similar spike so far.

Although the number of searches for the final on June 1st is elevated, it is not exceptional compared to surrounding weekends and aligns more closely with expected market dynamics.

This doesn’t mean that fans haven’t made bookings and that hoteliers are sitting forlornly hoping for a surge of bookings. Indeed, those left looking to get to London for the final might want to get a move on, as plenty of reservations are already on hotel books for the weekend of the final.

Four-in-ten hotels in London are listed as unavailable at the time of writing (hotels in the market that are either sold out, have length-of-stay restrictions in place, or are simply closed).

And across the capital just two-out-of-ten hotel rooms remain available, with occupancy sitting at 77%.

However, for those that do miss out on booking a hotel close to Wembley, there are still options, as short-term rental demand seems to be little affected, with occupancy sitting 33% below hotels on June 1st at 44% and showing no signs of being exceptional when compared to their hotel counterparts and surrounding weekends.

This is something we have observed in the case of several other major events, such as Taylor Swift’s Eras Tour, where hotels can provide a great deal more well-situated inventory, and are thus more attractive propositions to attendees.

For those willing to brave a cross-capital trip to alternative accommodation, then there are more options at this stage.

London hotel room prices move upward as expected

The Champions League Final is the highest expected demand event for London over the next six months, surpassing even the highly anticipated Eras Tour dates on June 21-23.

As a result of this elevated demand, hotels have been able to increase their prices, and they should be able to capitalize on a last-minute rush for space as those flight searches turn into confirmed trips in need of accommodation.

Not only have London hotel prices reached their highest point for the next six months, with a standard room being priced at £469 on 1st June, but rates are trending upwards.

Compared to 90 days ago, revenue managers have been able to increase their advertised rates by 8% and on an ever shorter time frame. Prices on the day of the final are up 5% compared to 14 days ago.

This momentum appears likely to continue, with room for several more percentage points of price growth in the final days, given the demand indicators we are observing.

The top-end of the London hotel market takes off

The original sale of final tickets for Wembley had a price range of €70 to €2,900. Those cheapest seats were only available to fans of the two participating teams, with 50,000 seats allocated for Real Madrid and Borussia Dortmund followers who had to apply via a lottery system, and then the general public could buy tickets from a starting level of €160.

In the resale market, prices have skyrocketed, reflecting the fact that Borussia Dortmund reported 400,000 requests for club allocated tickets. Tickets are now being sold for thousands of euros, with SeatPick reporting that the average resale value on their site was a little over €3,000 at the time of writing.

This surge in ticket prices indicates that many affluent football fans are still looking to make bookings, leading to a significant impact on pricing at the top end of the market.

Five-star hotels are not only seeing a bigger increase relative to nearby dates, but they have also been able to put up prices by a higher amount to the wider market over the last three months.

While across all hotels, rates were 23% higher compared to prior and following Saturdays, five-star hotels in London had a pricing bump of 35%.

A room at a five-star hotel is now 14% more expensive than 90 days ago, compared to the 8% rise for all hotels noted above.

Finally, as seen in the above analysis, short-term rentals are not nearly as in demand when compared to London hotels, and so there is relatively little effect on average pricing.

Rates have headed up slightly on the day of the final, but are still noticeably below reported prices for the summer peak period at £326.

It seems unlikely that the gap between hotels and short-term rentals will narrow in the very short time before the final and we shouldn’t expect much movement in this segment.

The role of demand and pricing intelligence when big events are in town

The Champions league final at Wembley underscores that anticipating a high demand event as an accommodation provider is not as easy as it appears on paper.

These events are tied firmly to market conditions and heavily influenced by the unique environment they operate in. This results in a broad spectrum of variations from one event location to another, even when there's a general trend of heightened demand.

This emphasizes the indispensable role of real-time market intelligence in setting the right room rates to ensure no money is left on the table.

Designed with the unique needs of hoteliers at its core, Lighthouse’s Market Insight and Rate Insight provide the ideal partnership of demand forecasts up to 365 days in advance and real-time competitor pricing data.

From this vantage point you're optimally positioned to capitalize on events in your market and drive substantial revenue, irrespective of the prevailing market conditions.

Get in touch to see how Lighthouse can illuminate trends in your local market.