Hotels in one of the biggest cities in Germany, Munich, experienced not that positive result in December 2016. The end of the year brought the decline of RevPAR (revenue per available room) of 4.4% compared to December 2015.
Munich hotels experienced difficulties in all main metrics. Even though the demand added 1.9% in December 2016, the supply was growing faster and outpaced the demand, reaching the growth of 2.8%. Consequently, the occupancy fell down by 0.8% to 69.0% in total. Hotels tried to boost the market by lowering ADR (average daily rate), which dropped by 3.6% to 119.87 euro. With both occupancy and ADR falling, RevPAR decreased as well by 4.4% to 82.69 euro.
The reason for such a weak performance can be in small business activity between Christmas and New Year’s Eve. Hotels in Munich traditionally serve many business travelers and December is not the best month for that. At the same time, pre-Christmas weekends, which are usually popular with leisure visitors from foreign countries, featured some growth, but it was not enough to offset the negative trend in the business segment.