Market Reports

Long-Term Growth Has Returned to European Hotel Industry

For the first three months of 2015, hotel occupancy rates on the continent rose by 3.3 points, despite Average Daily Rates (ADR) being up to 2.4%. The Revenue per Available Room (RevPAR) naturally evolved on a positive tangent by 5.8% over last year in the same period.
A bell on a hotel reception desk - source European Cities Marketing
Long-Term Growth Has Returned to European Hotel Industry

MKG Hospitality The new results from the ECM-MKG European Destinations Observatory report* highlight that long-term growth has returned to Europe’s hotel industry with new performances improvement in the sector.

For the first three months of 2015, hotel occupancy rates on the continent rose by 3.3 points, despite Average Daily Rates (ADR**) being up to 2.4%. The Revenue per Available Room (RevPAR***) naturally evolved on a positive tangent by 5.8% over last year in the same period. Results by city further confirm trends observed for several months, with an increase in nearly all cities, and particularly in Southern Europe and Scandinavia.

Generally speaking, Spanish cities fully benefitted from a favourable calendar, with the organisation of several events in Madrid, as well as Malaga and Zaragoza, reporting respective increases in RevPAR by 8.6%, 15.3% and 4.6%. Hotel activity in Central Europe was marked by strong growth in the RevPAR in Budapest (+14.4%), which continued to benefit from its attractiveness and price. Copenhagen and Stockholm are also among the destinations that recorded growth in their RevPAR by 7% and 3.6% respectively.

Congress cities (base: ICCA ranking measuring the number of rotating international association meetings in 2014), aside from those on the Iberian Peninsula, are off to a difficult start this year like Paris who had a stagnant RevPAR particularly in January due to the terrorist attacks. Vienna and Prague are particular examples with a decrease in their RevPAR by more than 3% and 9%. The Czech capital, despite a drop in average daily rates by more than 14% saw its arrivals increase by just 3.2 points. The results in the cities of Berlin and Brussels are up very slightly.

Ignasi de Delàs, ECM President commented: “The ECM City Tourism Monitor**** XXIV published in January 2015 outlined that city tourism experts’ predictions were optimistic, with 73% of respondent expecting a positive first quarter. It was also noted that the growth was expected to come predominantly from the leisure segment. The final results from the ECM-MKG European Destinations Observatory Report show that the city tourism experts’ forecasts are pretty accurate.”

All ECM members have exclusive access to the complete ECM-MKG European Destinations Observatory report with all the graphs and analysis. 

*ECM-MKG European Destinations Observatory report: A report produced by MKG Hospitality and released several times a year by ECM that presents the development of key performance indicators for ECM member cities.
**ADR: Average Daily Rate – room revenue divided by number of sold rooms.
***RevPAR: Revenue per Available Room – occupancy rate x average price or room revenue divided by available rooms.
****ECM City Tourism Monitor: A quarterly research that gives a barometer of city tourism. Through a survey of member city tourist offices and convention bureaux, it tracks perceptions as to the level of current and immediate future business across conventions and leisure tourism market segments. 

* European Cities Marketing is a non-profit organisation improving the competitiveness and performance of leading cities of Europe by providing a platform for convention, leisure and city marketing professionals to exchange knowledge, best practice and widen their network to build new business. European Cities Marketing is promoting and linking the interests of 110 members from more than 100 major cities in 36 countries.

Contact information
Flavie Baudot, press@europeancitiesmarketing.com, +33 380 56 02 00 

*Established nearly 30 years ago, MKG Group® has built a solid reputation for business expertise and substantial European-based know-how in the tourism, hotel and hospitality sector. MKG provides a unique savoir-faire in market research, consulting, financial feasibility studies, individual property and portfolio asset valuations, as well as quality control campaigns. The foundation of knowledge and resource is HotelCompSet, the largest industry database in Europe, representing all hotel segments.



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