COP29 in Baku sparks unprecedented hotel demand with 92% of properties at full capacity
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World's largest climate summit strains Azerbaijan capital's limited hotel inventory, driving historic rate surge
Key findings
Room rates surge 379% above the overall average for 2024
92% of Baku hotels not listing rooms on November 13
75%+ hotels unavailable November 11-15
Highest demand pressure during world leaders' summit
Hotel availability in Baku is reaching critical levels as the city prepares to host COP29, with new data revealing unprecedented pressure on the market during the UN climate summit this November.
The world’s biggest climate conference is leaving delegates chasing after a small number of hotel rooms in Azerbaijan’s capital
As climate action intensifies globally, the UN Climate Change Conference (COP) has evolved from a diplomatic summit to a huge event. With the planet’s future and hundreds of billions of financing at stake, the event is set to draw in tens of thousands of attendees.
The 29th version of the COP will be held in Azerbaijan’s capital Baku and the small size of its hotel market combined with a major influx of demand is driving historically high pricing, creating what industry experts call a "perfect storm" for extreme price rises.
Demand surge creates unprecedented hotel rate prices
Data reveals a sharp demand spike for Baku's hotels during COP29, with the most intense pressure concentrated in the summit's opening days.
While the conference spans November 11-22, the critical period centers on the world leaders' summit (November 12-13). Our analysis shows hotel availability reaching historic lows, with 92% of properties unavailable on November 13, and over 75% not listing rooms during the November 11-15 period.
We can see this in the share of hotels that are not listing rooms on the open market, which indicates very high points of demand from sell-outs and length-of-stay restrictions, alongside closures.
This measure is front-loaded to the opening week of the conference, but is above typical levels for both Baku and hotel markets generally throughout the duration of the conference.
The percentage then rapidly falls away, indicating still elevated demand, but looser supply of rooms in the second week of the conference, with the share of unavailable hotels decreasing from 68% on the of November 18, to 24% on November 24.
Record-breaking rates emerge for COP29's opening week
As of the time of writing with three weeks to go to COP 29, advertised prices have surged to the highest level for the city as far as our data goes back.
For the week beginning November 11, advertised prices for a standard hotel room stand at $676.
This is a 364% increase compared to the same week in 2023 and a 379% increase compared to the overall average of advertised and recorded prices across 2024.
For surrounding weeks, advertised prices are also elevated, but not to the same degree.
For the week starting 4th November, average rates sat at $237 at the time of writing, a 65% Year-on-Year (YoY) increase, and in the week following the event prices hit 193%, a 33% YoY uplift.
Data clearly identifies November 11-15 as the critical revenue period for Baku hotels, coinciding with the summit's highest-profile segment. This is when world leaders, and therefore most business executives and global media, will be transitioning through Baku.
The magnitude of the peak means hotels must achieve their maximum revenue potential in the opening week.
This pricing change overshadows any previous event in Baku’s recent history. Comparable demand-driving events were pre-pandemic in 2019, when the city hosted the Europa League Final between English Premier League sides Arsenal and Chelsea, and also the annual Formula 1 Grand Prix.
During these events prices doubled compared to the annual average, far less than the near quadrupling during COP 29, underlining the mismatch between demand and supply during the conference.
The impact of a global audience descending on a relatively small hotel market
That mismatch is severe as Baku has very limited inventory compared to total demand.
A useful comparator is the previous COP 28, which was held in Dubai. For that event demand was higher, but so was the supply in the market.
Dubai alone has around three times the total hotel room inventory of the entire country of Azerbaijan, let alone Baku. Whereas there are nearly 150,000 hotel rooms in Dubai, Azerbaijan has somewhere in the region of 57,000 bed places across accommodation types according to Statista.
COP 28 had a registered attendance of 69,503, roughly half of Dubai’s potential hotel room inventory, but more likely to sit at around a quarter of hotel bed places. This resulted in 70% YoY peak price increases during the central week of the event.
In comparison, even though some 20-30,000 less attendees are anticipated across this year’s version, this is still several times more than the total capacity of Baku’s overall hotel market, with 40-50,000 attendees enough to fill up the city’s hotels multiple times over.
Have we reached peak pricing in the build up to this event?
The above dynamics should mean further price rises right up until very close to the event, with our data recording noticeable price jumps over the short term and continued interest in inventory.
Searches for hotel rooms over OTA and metasearch sites continue to be notably more elevated, indicating plenty of relatively late demand continues to be realized.
At the peak point for hotel room searches on November 14, the level of queries is roughly over three times what would be expected for a normal booking curve.
Hotels therefore should be able to drive further pricing increases on the highly limited inventory remaining, a trend which we are seeing in our data.
Between September 23 and October 7, advertised prices went up 69% for November 10, which is just before the conference starts.
Clearly, this event is a market defining moment, and therefore hotels need the best market intelligence to make sure they achieve optimal revenue management.
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