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Growth is down in May

It was a bit of a pale month of May for Europe’s hotel industry. Growth in revenue per available room remains steady (+5.4%), but the result could have been better without the 1.3 point drop in occupancy. This drop held overall growth back despite average daily rates that continued their growth (+7.3%).

Progress of the European hotel industry slowed in May. With growth by 5.4% versus 11.8% on 12 cumulated months, the revenue per available room continues to grow at a good rate. However, the occupancy of properties suffered during this month that had many long weekends. The global occupancy rate is down by 1.3 points – compared with an excellent 2006 in this regard. Only the 2* category succeeded in equaling the previous year. The drop is more noteworthy in the super-economy categories, which did not compensate for the slump in business tourism with a stronger presence of leisure clientele. Fortunately the maneuvering margin remains wide on a pan-European level. Average daily rates were up by 7.3%. The upscale segment continues to boost overall results thanks to an 8.7% increase in average daily rates. Its RevPAR is up by 6.6%, significantly offsetting a 1.4 point drop in the OR. The revenue per available room on the midscale (+3.5%) and economy (+4.5%) segments also held up well. 0* and 1* categories, on the other hand, are unable to compensate for the drop in occupancy and close the month in the same vein as May 2006.There are strong disparities across Europe. There is an overall drop in occupancy. But some countries have not succeeded in compensating for this drop in occupancy rate with growth in average daily rate. Together with its Dutch neighbor (-2.0%), Belgium looks bad with an 8.5% RevPAR. The results for Germany, which was preparing for the World Cup last year, also suffers in comparison (-1.0%) due to a major drop in its occupancy (-4.4 pts). On the other hand, with respect to this particular context, the United Kingdom (+7.2%), Spain (+7.4%) and Austria (+7.6%) post very good results, as does Italy, which flirts with 4% growth. Between election weekends and long weekends in May, France is down with respect to most of its European neighbors. Its revenue per available room is down by 2.5%. In Eastern Europe, Poland confirms its recovery (+4.6%), unlike Hungary (-7.6%), where occupancy is down (-5.2 points).There are strong disparities across Europe. There is an overall drop in occupancy. But some countries have not succeeded in compensating for this drop in occupancy rate with growth in average daily rate. Together with its Dutch neighbor (-2.0%), Belgium looks bad with an 8.5% RevPAR. The results for Germany, which was preparing for the World Cup last year, also suffers in comparison (-1.0%) due to a major drop in its occupancy (-4.4 pts). On the other hand, with respect to this particular context, the United Kingdom (+7.2%), Spain (+7.4%) and Austria (+7.6%) post very good results, as does Italy, which flirts with 4% growth. Between election weekends and long weekends in May, France is down with respect to most of its European neighbors. Its revenue per available room is down by 2.5%. In Eastern Europe, Poland confirms its recovery (+4.6%), unlike Hungary (-7.6%), where occupancy is down (-5.2 points).

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