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Mixed Results of European Hotel Industry
European hotel industry has been showing somewhat muted growth even though the economy has started recovering in 2014. The number of hotels in pipeline keeps increasing five consecutive quarters since the beginning of 2014, but the total number of projects remains relatively flat. The number of hotels in pipeline is expected to grow during 2015 – 2017 with approximately 215-230 new hotels per year. However, such slowed down growth of European hotel industry may be even good for the region as there are many emerging destinations that become increasingly popular and attract larger number of tourists. By 2030, many destinations in Asia and the Pacific will become even more popular, and Northeast Asia will replace Mediterranean and Southern Europe.
According to the information provided by ForwardKeys, the annual rate of tourism growth in Europe estimated an average of 3.7% since 2007. At the same time, the global average growth estimated 5.7% during the same period. Some regions in Europe show better results than others. For example, IHG names the UK as one of its priority markets. The company’s properties reached the growth of RevPAR of 4.8% in the third quarter of 2015. Regional UK hotels also post good results. According to Dalata Hotel Group, their hotels in Manchester and Cardiff reached strong results in 2015.
German hotels managed to increase their RevPAR by 3% to almost 62% in total, while Spanish hotel industry gives rise to concerns due to economic recession. Same applies to Russia, where financial crisis has slowed down hotel market, but it didn’t cause catastrophic effect on the occupancy, so analysts forecast development, especially on the Moscow hotel market.
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