May 13 (Bloomberg) -- When Jose Castillo’s beloved Real Madrid eliminated trophy holder Bayern Munich last month to reach the Champions League final, he got busy booking his trip to European club soccer’s annual showpiece.
It looked easy: the game on May 24 against local rival Atletico Madrid will be played in Lisbon, less than six hours away by car. However, with average hotel prices heading toward 1,500 euros ($2,064) for the night of the final, he was forced to abandon his plan and will instead watch the match on television at home in Spain.
“It’s a rip-off,” said Castillo, 34, “It’s a shame because in the end, it’s Lisbon’s reputation that suffers.”
The first ever Champions League final between two teams from the same city risks being a let-down for fans unable to afford accommodation in the Portuguese capital, which was listed by Lonely Planet travel guides last year as one of its most reasonably priced European destinations. Lisbon hoteliers are charging more than four times the rates in London when the British capital hosted the same event last year, according to data compiled by hotel search website Trivago.
The spike in prices is threatening the much smaller city’s tourist-friendly reputation, said Simonetta Afonso, a member of the Municipal Assembly of Lisbon for the Socialist Party.
“We are creating a terrible image of our country and the city of Lisbon,” Afonso said in an interview. “These prices are pure speculation and threaten our tourism industry, the chicken that lays the golden egg.”
Tourism accounts for more than 10 percent of Portugal’s gross domestic product, according to the Economy Ministry. The Champions League final is the first to be staged in Lisbon since 1967, when the competition was known as the European Cup and won by Glasgow team Celtic. It comes a week after the country exits an international bailout program on May 17.
“Who defines or judges a price as being too high are the tourists and not the secretary of state for tourism,” Adolfo Mesquita Nunes, who holds that post in the Portuguese government, said in an e-mailed response to questions.
Hotel prices for the night of the match at the Benfica Stadium have risen by more than 13 times from the previous month to an average 1,428 euros, according to Trivago.
A three-star room near the city center costs as much as 5,000 euros, compared with the equivalent of 328 euros in London, which has more than twice the number of hotels than Lisbon. It cost an average of 281 pounds (344 euros) for the night when London’s Wembley Stadium hosted the final last year, Trivago figures show.
“Lisbon simply lacks enough rooms to meet such strong demand from tourists and some hotels are taking advantage,” said Ivo Borges, a spokesman for Trivago in Lisbon. “These rates are probably the highest in Europe right now.”
The Lisbon City Council is running an advertising campaign in Madrid, which at 630 kilometers (390 miles) away is the closest European capital, to convince Spanish tourists to extend their stay beyond the day of the soccer game.
An estimated 70,000 Spanish fans will come to the city for the game, according to the Spanish Embassy in Lisbon. That’s more than the capacity of the sold-out 61,000-seater Benfica Stadium, where Cristiano Ronaldo of Real Madrid will face off against Atletico Madrid’s Diego Costa.
About 98 percent of the roughly 900 hotels and hostelries advertised on Booking.com are sold out for the night of the match, according to the hotel reservation website. All 70 bungalows at Lisboa Camping are full, said Amaral Lopes, an official at the site in Monsanto Forest Park, the city’s largest green space.
Hotel Dom Afonso Henriques, a two-star hotel on the edge of Lisbon’s downtown area, still has rooms available.
“The cost of a double room is 3,500 euros for the night of the match,” Tatiana Rego, a receptionist at the hotel, said on May 6. “That doesn’t include breakfast.”
Real Madrid fan Castillo said some of his friends made hotel reservations months in advance. Their bookings then got canceled when prices began to take off earlier this month.
“They were told the hotels were undergoing renovation work, but that was probably an excuse to resell their rooms at a higher price,” Castillo said by phone from Madrid.
Tour operators and tournament sponsors may also be to blame for the rise in prices because they reserve a large number of rooms in advance, said John Martin, chief executive officer of U.S.-based Great Atlantic Sports Travel.
Russia’s OAO Gazprom and Ford Motor Co. are the main sponsors of the Champions League final, according to UEFA, European soccer’s governing body. UEFA’s press office said in an e-mailed response to questions that demand for hotels is always high in cities hosting such occasions.
“At major sports events like the Champions League final, hotel rooms can be sold four or five times before they get to the final user,” said Martin, whose company is selling travel packages for the game in Lisbon for $4,795. “If it’s a big event, prices have to rise. Otherwise it’s not a big event.”
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