How could the economic and political heart of a Spain in crisis resist the surrounding malaise? Madrid’s hotel market was logically affected –and hit hard at that– by the brutal slump in business. The RevPAR began to show signs of weakness from October 2008. “The first three quarters were excellent,” recalls Antonio Casado, managing director of High Tech Hoteles which has more than twenty 3* and 4* hotels in the city. The year ended on a bad note with a drop by – 6.8% in room revenue. But the descent had only just begun. The year 2009 closed with a drop in the RevPAR by – 25.9%, one of the biggest amongst the European hotel industry’s key market places. “We could hardly have hoped for worse,” regrets this hotelier. The businessmen who poured into most of the city’s hotels –national and foreign alike– became more rare.The primary two international clientele - Americans and British– were hit by the crisis full force. The occupancy rate that regularly flirted with 75% in the good years dropped below 60%. The average drop was by -7.7pts. Madrid, which had taken a certain amount of time to absorb the strong growth in its supply at the beginning of the 2000 fell behind again. With this situation, Madrid’s hotel industry entered an almost inevitable price war. The average daily rate posted a drop by 16.1%. The 4-5* segment represents nearly 60% of the city’s supply versus nearly 30% for the 3*. And properties –particularly the high capacity properties– brandished 2010 has begun on bad foundations. January marked a new drop in the RevPAR, by more than –12%. The upsets that affected all European countries kept many foreign customers on the ground.Is the first month of 2010 a harbinger of another difficult year? While we won’t talk...