The latest ECM-MKG European Destinations Observatory report* points out that, in European cities, the Revenue Per Available Room (RevPAR)** experienced in 2017 a 6% growth compared to 2016. The Occupancy Rate*** increased by 2.2 points and the Average Daily Rate (ADR)**** by 2.9%. Midscale and upscale hotels are on a dynamic trend with a RevPAR of +6% both compared to last year. Overall, growth can be observed throughout the continent, especially in the Iberian Peninsula, UK and Eastern Europe.
The « Brexit » did not turn visitors away from the United Kingdom
No casualty was deplored following the “Brexit” in the United Kingdom since the RevPAR grew by 5.6%. Edinburgh and London are in the top 3 with the best occupancy rate in Europe.
There are disparities for German and Italian cities
Germany is on a low-positive growth trend: +2.1% of the RevPAR. In spite of a strong business activity, some cities are on a down trend (Düsseldorf, Leipzig, Munich and Nuremberg), while Cologne, Hamburg and Hannover recorded a RevPAR increase of 13.1%, 5.7% and 5.3% respectively. Italy (+5.8%), after a difficult year in 2016, shows an increase in its RevPAR, this positive change can be explained by the good results recorded in Florence (+11.2%), Venice (+16.4%) or Milan (+6.4%). Rome continues to note negative results (RevPAR: -6.3%) but the occupancy rate remains almost at the same level compared to last year.
The year 2017, like 2016, has been very fruitful for cities located on the Iberian Peninsula
On the Iberian Peninsula, tourist arrivals continue to grow under the effect of their internal dynamics (improved economic context) and carryovers of visitors from Mediterranean destinations affected by terrorist attacks in recent months (Turkey, French Riviera, Egypt, Maghreb…). All cities in Spain (+9.6%) and Portugal (+18.8%) gained a strong RevPAR increase, as Madrid (+17.2%), who hosted many international business meetings this year, or Barcelona (+7.7%). These big cities are not the only ones since Valencia, Bilbao and Malaga also went through a RevPAR increase between 11% and 14%. Lisbon, which organised a few international conventions in the first part of the year, also posted a RevPAR increase of 24.5%.
Central and Eastern European cities posted steady growth in 2017
Warsaw posted a RevPAR up by 9.2% thanks to several international conventions or conferences with high average daily rate (+8.1%). Budapest, thanks to its solid business activity, is off to a good start this year, and counts on a RevPAR increase of 12.6%. Vienna also recorded a RevPAR increase (+1.1%) along with Prague, host of many congresses and conferences, (+ 9.6%), the occupancy rate rose by +2.4 points and the average daily rate increased by 6.5% compared to 2016.
France and Benelux also gained in RevPAR in 2017
Belgium observed an increase in its hotel performances, (+13.9%) for its RevPAR. Brussel’s RevPAR rose by 17.4%, mostly due to a 9.5-point increase in its occupancy rate. Ghent (+12.2%) is on a positive trend too. In this Benelux area, Luxembourg observed a RevPAR increase (+13.4%), while Amsterdam after the organisation of international business events, recorded a RevPAR increase of 10.4% and the highest occupancy rate among this sample of cities.
France only showed a growth (+4.9%) thanks to its strong touristic pole: Paris recorded a 5.5-point increase in occupation rate, and a RevPAR rise of 6.2%. Other cities like Bordeaux (+7.8%), Toulouse (+4%) and Bayonne/Biarritz (6.9%) also recorded a RevPAR increase. Only Montpellier is on a negative trend (RevPAR: -9.3%), Lille and Lyon have a RevPAR change negatively stable (-0.3%).
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.
**RevPAR: Revenue Per Available Room – Occupancy Rate x average price or room revenue divided by available rooms.
***Occupancy Rate: Number of rooms sold divided by number of available rooms.
****ADR: Average Daily Rate – room revenue divided by number of sold rooms.
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 members from more than 100 major cities in 38 countries.
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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 OlaKala_suite, the largest industry database in Europe, representing all hotel segments. OlaKala_suite, brings together all operational marketing tools in 3 major products:
* OlaKala_destination: Observatories (formerly HotelCompSet)
* OlaKala_marketshare: Competitive Set, market reports, price tracking (formerly HotelCompSet)
* OlaKala_host: Satisfaction surveys, eReputation, quality audit.