European Hotels Deliver Mixed Results in February

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According to STR Global, the European hotel industry posted mixed results in year-over-year metrics when reported in U.S. dollars, Euros and British pounds for February 2015.



Northern Europe continues to "dominate the region", according to Elizabeth Winkle, managing director of STR Global. The sub-region saw double-digit growth for both ADR (+14.8 percent to EUR108.13) and RevPAR (+18.3 percent to EUR76.96).

"Northern Europe's hotel performance is largely dominated by the United Kingdom", Winkle said. "In sterling, the sub-region's RevPAR growth was up almost 5 percent in comparison. The difference was impacted by the strength of the British pound against a weaker Euro".

Winkle also noted "steady growth" in Western Europe, where RevPAR increased by 5.9 percent to EUR69.68, driven by ADR (+3.4 percent to EUR115.15) and occupancy (+2.4 percent to 60.5 percent).

Southern Europe recorded slight ADR growth of 1.1 percent to EUR91.76, whereas Eastern Europe reported double-digit declines in both ADR (-15.6 percent to EUR69.20) and RevPAR (-12.0 percent to EUR35.37).

"The conflict between Russia and Ukraine, sanctions and the plummeting of gas prices are negatively impacting the region", Winkle said.

Amongst countries in Europe, six experienced RevPAR increases of at least 20.0 percent when reported in Euros: Lithuania (+35.6 percent to EUR26.50); Croatia (+24.3 percent to EUR15.99); Ireland (+23.2 percent to EUR63.12); Malta (+23.0 percent to EUR46.23); Hungary (+20.8 percent to EUR31.49); and the United Kingdom (+20.7 percent to EUR81.40).

"With the Euro being at a 12-year low against a strengthening U.S. dollar, an increasing number of U.S. travelers are expected to visit Europe in 2015", Winkle said. "However, slower economic activity and a weaker Euro may affect business travel across the region, as well as outbound travel to the U.S."

 
Highlights from key market performers for February 2015 include (year-over-year comparisons, all currency in Euros):

• Five markets recorded double-digit occupancy increases, led by Vilnius, Lithuania, where occupancy was up 21.5 percent to 49.4 percent. Warsaw, Poland, followed with a 17.5-percent occupancy increase to 69.1 percent.

• Moscow, Russia, reported the largest occupancy decrease, falling 5.7 percent to 58.2 percent.

• Manchester, England, reported the largest ADR increase for the month, up 24.9 percent to EUR99.72. Tel Aviv, Israel, followed with a 23.2-percent increase to EUR186.18.

• Barcelona, Spain, reported the largest ADR decrease, falling 29.6 percent to EUR98.79. Moscow experienced the second-largest ADR decrease, dropping 28.4 percent to EUR90.29.

• Four markets experienced RevPAR increases of more than 20.0 percent, including Vilnius (+38.5 percent to EUR28.10). Manchester followed with a 31.8-percent increase to EUR81.56.

• Barcelona (-33.3 percent to EUR58.54) and Moscow (-32.5 percent to EUR52.58) reported the largest RevPAR decreases.