Anyone considering investing in camping in the near future should know that the future of this business lies not so much in mobile homes, but in premium plots, that the summer season will become increasingly demanding, and that the business season will be longer, and it seems that glamping, a segment that was predicted a golden future a few years ago, has come to an end. It should also be noted that the rise in service prices this year has reached a ceiling and that further price increases will require significant investment in premium services.
Investors in Croatia may also need to keep in mind that by the end of the year, a new regulation on concessions for tourist land will likely come into effect, which has been awaited for years. At the same time, those hoping for tax relief for investments should know that the Ministry of Tourism will have the authority to implement the Investment Promotion Act in tourism based on the Tourism Act, which is currently in its first reading in the Parliament.
All of this is being discussed today and tomorrow at the Camping Congress organized by the Camping Association of Croatia, in a year when physical results have returned to or exceeded pre-pandemic figures, and service prices have never been higher, due to inflation and last year’s optimism.
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Currently, Croatian camps can accommodate about 255,000 people in around 800 camps, with a total of about 84,300 plots and around 15,000 mobile homes, which is 17 percent. From the beginning of the year until November 5, 2023, camps recorded nearly 21.5 million overnight stays, an increase compared to last year.
Average price of overnight stay 130 euros
Sandra Janković from the Faculty of Management in Tourism and Hospitality (FTMU) pointed out that Croatian camping results do not differ from competitors in the Mediterranean.
– As the first benchmark data for camping in the first nine months showed, from April to the end of September, the occupancy in mobile homes was 49 percent, and in plots 44 percent, with the highest occupancy of mobile homes at 60 percent in Istria. Croatian camps have made significant strides in quality over the last 10 years, evidenced by the high ADR (average daily rate). This year, the average price of an overnight stay in mobile homes, including the off-season, was 130 euros, and for plots 40 euros, with the maximum price of an overnight stay in a mobile home recorded at 373 euros in Istria, which is much higher than the most expensive overnight stay in a 4-star hotel.
Thus, this year, revenue per unit has also increased, continuously rising. – Since 2015, when we started tracking, the annual revenue per mobile home has increased from eight thousand to 17 thousand euros, and for plots from 2,300 euros to 4,300 euros this year – revealed Janković.
That prices cannot go higher unless there is investment in quality improvement was conveyed today to the sector by Veljko Ostojić, director of the Croatian Tourism Association, who believes that the next season must be approached with special caution, considering the economic conditions in the countries from which our guests come, such as Germany.
Ward Wijngaert from the camping group Yelloh! Village also stated that service prices in camps this summer reached a peak in the Mediterranean, especially overnight stays in mobile homes.
Glamping is no longer interesting to investors
Even though they bring in higher revenue, mobile homes are a greater expense, and investors can expect an even greater need for investment in this segment in the future. Therefore, it is predicted that the number of plots in European camps will increase at the expense of mobile homes.
– Mobile homes are becoming increasingly expensive due to construction costs, sustainable solutions that are more expensive, the fact that they must be replaced or renovated every 10 years, and the return on investment is decreasing. On the other hand, families with children, who come in the high season, mostly vacation in mobile homes, while seniors with their own campers come in the off-season, and they need plots. If we want to extend the season, that is the answer.
Also, due to the extreme heat, destinations in the Mediterranean will have problems attracting guests in the summer months. Furthermore, glamping, which was so much talked about a few years ago due to climate change, will no longer be interesting to investors. Namely, luxury tents, which is essentially what glamping is, not only lack any insulation for heating and cooling, but are also sensitive to storms, which are becoming more frequent – says Wijngaert, who revealed to Lider that Yelloh! Village is looking for investment opportunities in camping in Croatia.
Their target is independent camps, and they are already negotiating with a few. Currently, they operate in the markets of Spain and France, and due to climate change, they are facing significant problems with camps in Spain, which authorities want to close due to frequent flooding. Investors believe that this is a very rigid approach and advocate for adaptation to climate change instead of closure.
