World Cup hotels costlier than Olympics in Brazil
Hotel rooms are expected to cost almost 50 percent more in Rio
de Janeiro during the upcoming World Cup soccer tournament than
when the city will host the 2016 Olympics, in part because
organizer FIFA’s official accommodations agency hasn’t set maximum
room rates like those promised in Rio’s winning bid for the Olympic
FIFA is working with the Swiss company MATCH Services as the
official accommodations agency for the World Cup. MATCH signed
contracts with the vast majority of hotels in Rio and other cities
that will host matches, and offers rooms via FIFA’s website at high
rates that have prompted an ongoing investigation by the Brazilian
government into possible cartel-like practices.
Industry studies, documents from Rio’s Olympic organizing
committee and an Associated Press review of hotel prices offered by
MATCH all show the discrepancy between housing costs for the two
big sporting events.
The cost difference between the two big events is in large part
a result of the local Olympic organizing committee capping hotel
prices. But analysts say it’s also the simple economics of supply
and demand: More fans are expected during the World Cup than the
Olympics, and more hotel rooms will be available during the 2016
games because of ongoing construction of facilities.
”It’s normal that having the FIFA agency involved in the
negotiations affects the prices,” said Alfredo Lopes, president of
the association’s Rio de Janeiro bureau. ”MATCH negotiated all the
prices with almost 90 percent of the hotels in Rio. Now it’s just
reselling the packages.”
Other analysts said the price difference also reflected local
fervor for the World Cup.
”What may play a role in the difference in prices is the
magnitude of having the World Cup in a country like Brazil, where
football is everything,” said Gabriela Otto, a hotel industry
consultant. ”That may attract a lot more people compared to the
Olympics, and prices are always linked to supply and demand.”
Also playing a role is the expectation that Rio will have nearly
10,000 more hotel rooms in 2016, according to the Brazilian Hotel
”The industry already knows that in 2016 there will be a lot
more rooms available in Rio, so the prices likely will have to be
adjusted for that,” said Flavia Matos, an executive director with
the Brazilian Forum of Hotel Operators.
The average cost for a hotel room in Rio during the football
tournament is expected to run about $460, according to the
Brazilian government’s tourism agency and an AP analysis of prices,
while during the Olympics the average maximum rate is estimated at
about $310, according to Rio’s Olympic bid document used to win the
In August, Brazil’s tourism agency Embratur asked FIFA and hotel
operators to negotiate lower prices for the World Cup. The request
came after one study showed that some room rates would run up to
500 percent higher in some hotels offered by MATCH.
Then in October, the Brazilian government said it would
investigate whether MATCH was involved in ”cartel” practices
leading to hotel price hikes.
As yet, the government’s tourism agency has taken no action even
though the World Cup is less than six months away and many hotels
are already sold out.
”The federal government is watchful of the prices charged by
hotels during the World Cup and will mobilize all available means
to prevent any abuse,” the Sports Ministry said in a
MATCH, which is also FIFA’s agency for selling tickets to the
World Cup matches, has repeatedly denied any wrongdoing and said it
could not explain the difference in expected hotel costs between
the World Cup and Olympics.
”We are not in a position to comment with respect to hotel
accommodation for the Olympic Games as we do not know at all what
kind of arrangements may have been made or what conditions may have
been imposed,” MATCH said in a statement.
The company said it’s primarily responsible for contracting and
delivering accommodation for the FIFA community, including its
officials, delegates, guests and staff. It also sells rooms to
FIFA’s commercial affiliates, the media and hospitality customers.
Rooms are offered to the general public through the FIFA website
operated and maintained by MATCH.
FIFA and MATCH this month were each fined more than $200,000 by
consumer rights officials because of alleged ticket irregularities
at a Confederations Cup venue, and prosecutors still want the
entities to pay nearly $2 million in damages for allegedly not
providing the seats that fans paid for during the warm-up
tournament this year.
Follow Tales Azzoni on Twitter: http://twitter.com/tazzoni