Market Report Europe

European Chain Hotels Market Review - August 2017

Hotels in Europe recorded an impressive 7.1% year-on-year increase in GOPPAR this month, with the growth led by a number of key tourism destinations, including Dublin and Barcelona, according to the latest worldwide poll of full-service hotels from HotStats.

Hotels in Europe recorded an impressive 7.1% year-on-year increase in GOPPAR this month, with the growth led by a number of key tourism destinations, including Dublin and Barcelona, according to the latest worldwide poll of full-service hotels from HotStats. 

As room occupancy levels hit a lofty 78.7% this August, hotels across Europe were able to successfully leverage achieved average room rate, to record a 4.8% increase in this measure to €149.95. As a result of the movement in volume and price, hotels in Europe recorded a 5.7% increase in RevPAR.

Unsurprisingly, demand this month was driven by the leisure segment, which accounted for 38.9% of the market mix in the region, compared to 30.3% in the 12 months to August 2017. Furthermore, strong rate growth was recorded in both the individual leisure (+6.7%) and group leisure (+4.3%) segments.

The year-on-year growth in achieved average room rate, which was driven by the leisure segment, meant that at €117.55, RevPAR at hotels in Europe was 6.7% above the average for the 12 months to August 2017, at €109.68, illustrating the current strength of the leisure sector in the region.

Year-on-year growth in non-rooms revenues, including Food and Beverage (+3.1%) and Conference and Banqueting (+4.8%), contributed to the 4.9% increase in TrevPAR, to €167.60.

Profit & Loss Key Performance Indicators – Europe (in EUR)

August 2017 v August 2016

RevPAR: +5.7% to €117.55

TrevPAR: +4.9% to €167.60

Payroll: - 0.4 pts to 30.2%

GOPPAR: +7.1% to €62.26

In addition to the year-on-year increase in TrevPAR, a reduction in costs, including a 0.4 percentage point saving in Payroll to 30.2% of total revenue, helped hotels in Europe record a 7.1% increase in GOPPAR, to €62.26.

Whilst hotel markets across Europe achieved mixed results, the overall growth in the region was led by the stellar performance of a number of popular tourist destinations.

This was no better illustrated than by the performance of hotels in Barcelona, which recorded a 15.3% year-on-year increase in RevPAR, to €247.14. This increase was in spite of a 2.8 percentage point decline in room occupancy, to 86.8%, as achieved average room hit a high for the year at €284.67, an 18.9% increase on the same period in 2016.

Profit & Loss Key Performance Indicators – Barcelona (in EUR)

August 2017 v August 2016

RevPAR: +15.3% to €247.14

TrevPAR: +9.9% to €335.62

Payroll: - 1.3 pts to 20.0%

GOPPAR: +17.8% to €178.10

“Despite facing a number of challenges this year, which included the terrorist attacks in August, there has been little evidence of an impact on the performance of hotels in Barcelona as tourists continue to flock to the city driving the peak in rate this month.

Demand levels were also fuelled by the European Society of Cardiology Congress this month, which is the biggest cardiovascular conference in the world. This world-renowned event always provides a welcome boost in performance for the host city, as it did for London in 2015 and Rome in 2016,” said Pablo Alonso, CEO of HotStats.  

For hotels in Dublin, August represented another strong month of performance in the city that just keeps on growing. Further to the uplift in profit per room in both 2015 (+30.2%) and 2016 (+19.9%), hotels in the Irish capital are set for another bumper year of growth with the year-to-date increase in GOPPAR recorded at 10.1% to €83.86.  

This month, the 14.4% increase in profit per room was fuelled by a 9.8% increase in RevPAR, to €160.44. Whilst room occupancy levels in the city dropped by 4.0 percentage points, to 87.4%, the number of visitors to the city remained high and enabled hoteliers to drive a 14.7% increase in achieved average room rate, to €183.50, offsetting the drop in volume.

Consistently strong demand levels and a lack of supply additions have enabled hotels in Dublin to record a RevPAR increase of more than €45 over the last three years, to €141.23 in the 12 months to August 2017 from €96.11 during the same period in 2013/14.

In addition to the growth in Rooms Revenue this month, growth in non-rooms revenues delivered a 9.3% increase in TrevPAR, to €227.56. And with Payroll falling by 1.1-percentage points to 29.0% of total revenue, hotels in the Irish capital achieved a profit conversion of 41.7% of total revenue.  

“As the capital of Ireland and the primary international transport gateway, and always the place for a good craic, Dublin has benefited from the significant uplift in tourists to the Emerald Isle, with overseas visitors exceeding 10.1 million in 2016, a 22% increase in just three years.

Additions to supply which are mooted in the city could add more than 2,400 bedrooms to Dublin hotel stock, which could hamper continued growth efforts. But in the meantime, Dublin hotel performance is going from strength to strength to strength,” added Pablo.

Profit & Loss Key Performance Indicators – Dublin (in EUR)

August 2017 v August 2016

RevPAR: +9.8% to €160.44

TrevPAR: +9.3% to €227.56

Payroll: - 1.1 pts to 29.0%

GOPPAR: +14.4% to €94.86 

 

HotStats provides two reporting tools to hoteliers:

Our unique profit and loss benchmarking service which enables monthly comparison of hotels’ performance against their competitors. It is distinguished by the fact that it provides in excess of 100 performance metric comparisons covering 70 areas of hotel revenue, cost, profit and statistics providing far deeper insight into the hotel operation than any other tool.

Our latest innovation in daily revenue intelligence, MORSE. Amongst its reporting are daily and highly granular market segmentation metrics as well as distribution channel and source of booking analysis. It takes daily market intelligence to a whole new level.

For more information contact:
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