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Assessment of the Summer Season
for the European Hotel Industry
MKG Consulting
October 2002

European hotel industry - cumulated results of the
months of July and August: 

  • A good summer season for medium-sized cities and seaside hotels
  • In Europe, an increase of 1.8% in the RevPAR for seaside hotels in June - August
  • The revenue per available room fell 3.5% for Europe as a whole. 
  • The capitals are in retreat, the medium-sized cities are strongly on the rise
  • An increase in the RevPAR higher than 5% for Marseilles, Manchester, Barcelona, Rotterdam and Antwerp in July - August. 
  • In France, the provincial regions and the coasts end the season at a reasonable high (+6% for the RevPAR)
Among the most significant facts from the summer of 2002, the following merit particular attention:

1- In Europe, the hotels along the coasts and the medium-sized cities post the best results of the season. 

Results from the hotel activity for the 2002 summer season in Europe, by site
(Average daily rates and RevPAR in Euros including VAT)

Occupancy Rate
Average Daily Rate
RevPAR
07/08

2001

07/08

2002

CHG. (Pts.)
07/08

2001

07/08

2002

CHG. (%)
07/08

2001

07/08

2002

CHG. (%)
Capitals
75.0%
70.8%
-4.1
112.7
111.6
-0.9%
84.5
79.0
-6.4%
Medium-sized cities
66.9%
66.6%
-0.3
92.3
92.4
0.1%
61.8
61.6
-0.3%
Coasts
81.8%
80.2%
-1.6
91.8
95.4
3.8%
75.1
76.4
1.8%
Airport
74.3%
68.9%
-5.4
84.0
79.8
-5.0%
62.4
55.0
-11.9%
Global
71.7%
69.8%
-1.9
95.6
94.8
-0.8%
68.5
66.2
-3.5%
Source: MKG Consulting Database � 09/02

The revenue per available room (RevPAR) experienced a light fall (-3.5%) during the months of July and August. This drop appears limited in view of the unfavourable economic conditions and disastrous climatic conditions that have affected a large part of Europe during the course of the summer. The occupancy rate only lost 1.9 points, for 69.8%, and the average daily rate lost 0.8% for 94.8 Euros including VAT in all categories combined. 

The only hotels to record distinctly low results were those situated in the 15 European capitals, and particularly, hotels located at airports. Again, this fall concerns the upmarket segment (4* category), since the budget categories continue to post good performances. The seaside and urban destinations recorded the best differentials in terms of occupancy, as well as a RevPAR. France, Brittany and Côte d�Azur have had a very beautiful summer season, helping a strong rise in European clientele. In these two regions, the RevPAR augmented by 7.6% and 7.8% respectively.

The terrorist attacks of September 11, 2001 still linger in the minds of consumers. During the summer of 2002, tourists have favoured destinations that are closer to home, with the exception of the capitals (-4.1 points in the occupancy rate)

2- The principal medium-sized cities in Europe post excellent results 

Results from the hotel activity for the 2002 summer season in Europe, by city
(Average daily rates and RevPAR in Euros including VAT)

Occupancy Rate
Average Daily Rate
RevPAR
07/08

2001

07/08

2002

CHG. (Pts.)
07/08

2001

07/08

2002

CHG. (%)
07/08

2001

07/08

2002

CHG. (%)
Paris
79.2%
73.6%
-5.6
128.5
116.5
-9.3%
101.8
85.7
-15.7%
Marseilles
84.8%
82.3%
-2.5
59.2
64.9
9.6%
50.2
53.4
6.4%
Berlin
68.6%
62.1%
-6.5
91.6
83.4
-8.9%
62.8
51.8
-17.5%
Munich
77.7%
70.0%
-7.8
107.2
102.6
-4.3%
83.3
71.8
-13.9%
London
84.2%
80.6%
-3.6
108.5
103.1
-5.0%
91.3
83.1
-9.1%
Manchester
72.1%
73.7%
1.6
64.8
69.4
7.0%
46.8
51.1
9.4%
Madrid
57.5%
56.8%
-0.7
94.7
93.7
-1.1%
54.4
53.2
-2.3%
Barcelona
72.5%
76.0%
3.6
108.6
111.5
2.7%
78.7
84.8
7.7%
Amsterdam
86.4%
84.5%
-1.9
128.9
122.1
-5.2%
111.4
103.2
-7.4%
Rotterdam
62.6%
63.8%
1.2
80.8
85.2
5.5%
50.6
54.4
7.6%
Brussels
62.0%
60.4%
-1.6
82.9
75.9
-8.4%
51.4
45.8
-10.8%
Antwerp
58.5%
63.5%
4.9
68.5
73.6
7.3%
40.1
46.7
16.4%
Source: MKG Consulting Database � 09/02

The summer tendency per major city is quite clear: a pronounced downturn in the activity in the capitals, a very strong increase in the indicators of the medium-sized cities: thus Paris, London, Madrid, Amsterdam, and Brussels have seen their occupancy rates and revenue per room available orient negatively. Inversely, Marseilles, Manchester, Barcelona, Rotterdam and Antwerp have seen a progression in the RevPAR near or higher than 10%. All these cities, with the exception of Marseilles, recorded equally a clear improvement in the occupancy rate: +3.6 points for Barcelona and +4.9 points for Antwerp. In the summer of 2002, the hotel demand did not collapse, far from it! Important clientele shifts from the capitals to the medium-sized cities took place. The only exception is Germany, since Berlin (-17.5%), as well as other medium-sized citied saw significant falls (-13.9% low for the RevPAR in Munich). The large economic crisis that is affecting Germany is not without consequences in its hotel industry.

3- In France, a large improvement for properties situated in provincial areas

Results from the hotel activity for the 2002 summer season in Europe, by site
(Average daily rates and RevPAR in Euros including VAT)

Occupancy Rate
Average Daily Rate
RevPAR
07/08

2001

07/08

2002

CHG. (Pts)
07/08

2001

07/08

2002

CHG. (%)
07/08

2001

07/08

2002

CHG. (%)
Paris
79.2%
73.6%
-5.6
128.5
116.5
-9.3%
101.8
85.7
-15.7%
Provincial France
77.9%
78.2%
0.3
61.0
64.3
5.4%
47.5
50.3
5.8%
Coasts
87.3%
86.7%
-0.6
98.7
105.1
6.4%
86.2
91.1
5.7%
Côte d'Azur
89.8%
88.1%
-1.7
140.9
151.6
7.6%
126.5
133.6
5.6%
Global
76.3%
75.0%
-1.3
69.5
69.9
0.5%
53.1
52.4
-1.3%
Source: MKG Consulting Database � 09/02

France adheres perfectly to the European tendency: a downturn of activity in the capital and a clear improvement in the indicators in the other zones. Provincial and coastal France (such as Côte d�Azur) post a growth in the RevPAR in the order of 6%, while at the same time Paris records a negative differential. In the end, throughout France, the summer season concluded with a RevPAR that is down 1.3%, which is better than the performance of Europe (-3.5% for July- August).

In France, as well as Europe, the tendency of improvement continues. In August, the French and European hotels recorded their best results since April 2002. This tendency continued in September, with indicators that should post strong rises. The end of the year should also be in the same trend, and permit the European hotel industry, globally, to resume with its activity indicators oriented strongly upwards.

Methodology
This study is based on a sample of 5,000 corporate operated chains in Europe, representing 500,000 rooms. The data, gathered monthly from each hotel, is redressed according to the segmentation of the corporate operated hotel chain supply, and by the weight of each country in the European Union. 

These results come from figures supplied by the hotel chains located in France and throughout Europe, of which MKG Consulting is the official statistical supplier.

MKG Consulting has the largest hotel database in the world, outside the United States, with the best coverage of all the hotel segments. 

###
Contact:

Georges Panayotis
00 33 (0)1 56 56 87 90
[email protected]
http://www.mkgconseil.com/
Also See: The Worldwide Ranking of Hotel Groups; The worldwide supply of hotel groups grows by 3% in 2001 (4.9 million rooms) / June 2002
Europe�s Hospitality Industry in 2001: France is Doing Better than its European Neighbours / Feb 2002

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