Glamping accommodations, once viewed as an alternative to hotels, are bridging the gap to traditional stays both in terms of investment and returns, especially in parts of Europe such as Austria, Croatia, Germany, Hungary, Serbia and Switzerland.
Recent injections of institutional and publicly listed capital into glamping assets remind many in the hotel industry of money entering the hostel niche in 2014. At the time, Invesco Ltd. signed a deal with Patron Capital to take a 23% stake in Generator Hostels for €60 million ($65.2 million).
That investment is paying off, with average daily rates for glamping accommodations rivaling or exceeding hotel rates.
The global glamping industry is set to reach a value of $5.94 billion by 2030, a compound annual growth rate of 10.9%, according to a February 2023 report from San Francisco-based market-research firm Grand View Research. The report added the niche was valued at $2.35 billion in the last full year of revenue data for full-year 2021. Treehouses, a niche within glamping, are expected to reach a value of $363.6 million alone by 2028.
Europe had the greatest share of the glamping market in 2021 at 35.1%, according to the report.
In some European countries, glamping options have been added to traditional hotel accommodations and have been marketed by listings companies such as the United Kingdom’s Canopy & Stars.
In the U.S., publicly listed Summit Hotel Properties bought 90% of Onera Fredericksburg in a joint venture with Onera Escapes in November 2022. A news release on NASDAQ said the “partnership marks the first-ever stand-alone glamping investment from a public [real estate investment trust] in the fast-growing segment, which has a 14% forecast revenue [compound annual growth rate] from 2022 [to] 2030, and represents a major step in the maturation of the alternative-accommodation market to the institutional level.”
In Europe, the main publicly listed company involved in this niche is PPHE Hotel Group, which owns glamping division Arena Hospitality Group, listed on the Zagreb Stock Exchange. The firm has an exclusivity agreement with Radisson Hotel Group to develop and operate the Park Plaza brand in Europe, Middle East and Africa, and also owns and operates the Art’otel hotel brand.
Aside from traditional hotels, Arena has eight alternative-accommodations assets.
In 2018, it opened Arena One 99 Glamping, near Pula, Croatia. The property was a conversion from the firm’s Arena Pomer Campsite, which the company claims is Europe’s first dedicated glamping resort. Operating between June and September, it has 199 glamping options and a minimum stay of three nights.
It since has opened two similar properties, Arena Grand Kažela Camping Homes and Arena Stoja, also both close to Pula.
Manuela Kraljević, member of the management board and director of marketing and sales at Arena, said what sets Arena One 99 Glamping apart is its “dedication to providing a luxurious hotel-like experience within the glamping realm.”
She said staples of Arena's glamping offerings include intimate, cozy settings, comfortable beds, seating areas and stylish decor.
“The attention to detail ensures a comfortable and memorable stay that rivals a five-star hotel,” she said.
Facilities offered include outdoor jacuzzis, restaurants, coffee shops, relaxation areas and yoga platforms, which Kraljević said appeal to guests seeking something different from a conventional hotel stay.
“The exclusivity and distinctiveness of glamping accommodations contribute to their perceived value and justify higher rates. Our glamping site aligns with eco-oriented guests through unique amenities and initiatives, such as e-chargers, birdhouses and other sustainable features,“ she said.
Touring Club Suisse Camping is another European company with glamping options, one of which is the Touring Club Suisse Camping Scuol in Switzerland, very close to the borders of both Austria and Italy. In all, the company has 25 accommodations offerings, including nine with glamping.
Its Scuol asset includes vintage caravans, safari tents, “nostalgia wagons,” and “riverlodges,” among 21 different choices.
Oliver Grützner, director and head of tourism and leisure at Touring Club Suisse Camping, said he is adamant glamping can be scaled in a branded format.
“We are convinced that this is possible, but mainly in the background so that the local, unique touch is not lost. In the end, it is always a business challenge what is financially viable and profitable,” he said.
Cedric Schoch, head of corporate development and gastronomy at Touring Club Suisse Camping, said glamping’s average daily rate is not that far behind — and in some cases, higher — than that of a hotel.
“Customers pay for an exceptional, timely, limited, emotional experience, and with detailed service, even higher than with hotels. We believe that the trend will continue, and glamping will be established as a resort-like hospitality market,” he said.
Not Going Away
Schoch said glamping remains a niche compared to hotels, but is here to stay.
“Glamping is less focused on real estate, so it is more flexible and can adapt to market trends. Profitability is more difficult as it also depends more on external factors like weather, a small number of units and a quicker payback period,” he said. “The terrain is usually more difficult and costly to manage [and] the distances for services are longer.”
Kraljević agreed the segment presents particular challenges.
“The seasonal nature of glamping operations, such as in the northern part of the Adriatic where Arena One 99 Glamping is, means limited operating seasons due to weather conditions or specific tourism patterns,” she said. “Workforce availability and management can also be common challenges requiring strategic planning, efficient resource management and continuous adaptation to market demands.”
Changing attitudes toward travel have helped, too, as guests have sought unique, immersive experiences since the pandemic, which she said glamping perfectly aligns with.
“Looking ahead, we anticipate continued growth and diversification in glamping offerings, with glamping sites developed and operated under a unified brand. ... We believe that hoteliers can seize the market’s potential and create memorable destinations for travelers seeking a blend of luxury, nature and tranquility,“ she added.
Schoch said for the niche to work on a scaled format, “the strength of the distribution is essential. This is of course better possible in a larger company and may use more of the scale of economy.“