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Hotels in London Enjoy Growth While Munich Hotels Suffer in June 2017
Hotels in London had a positive month as they managed to improve nearly all main metrics in June 2017. The year-on-year data provided by STR shows a definite positive shift, which has helped London hotels to end the month with the growth of RevPAR of 5.1%.
Even though the occupancy went down by 0.4% to 84.1% in total, and hotel supply in the city added significant 3.6%, hotels in the capital of the UK were not stricken by that as the demand was growing as well and added nearly 3.2% in June. Together with the raising average daily rate of 5.5% to GBP162.51, London hotels managed to increase their revenue per available room (RevPAR) by 5.1% to GBP136.72. Currently, the hotel industry of the city is in good shape, and even terror attacks cannot do any serious harm to tourist arrivals.
When terrorists attacked people on London Bridge on the 3rd of June, hotels in London faced a small decline in occupancy for several days. Only a week later, the market returned to its usual state. The average daily rate was growing for one more reason – because of the change of Eid Mubarak time. As a rule, the holiday falls on July, but this year it was in June, so numerous visitors from the Middle East visited the city earlier.
Not all European cities could post positive results of par with London. Hotels in Munich suffered a severe decline in June 2017. The hotel supply added 2.4%, but the demand was down by 6.0% year-on-year. Naturally, the occupancy fell as well. The decline estimated 8.2% to 75.5% in total. Hoteliers tried to stimulate the market by declining the average daily rate by 8.5% to 121.03 euro. However, that didn’t help much, and Munich hotels ended the month with the striking decline of RevPAR of 16.0% to 91.36 euro.
This is a truly devastating result for the German city as it is the worst RevPAR since 2011. There might be several reasons for such a poor performance of hotels in Munich. According to some experts, the shift of Whitsun school holiday from May to June negatively affected the demand of the corporate segment. Also, a year ago, in June 2016, Munich hosted two large events – Automatics trade fair and the World Conference on Non-Destructive Testing. The first event is biennial, and the latter one is quadrennial, so they didn’t take place in the city this year.
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