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Catalan Independence Shrinks Revenues of Barcelona Hotels

News Spain is currently passing through a tough period as one of its regions, Catalonia, has proclaimed independence. The capital of Catalonia, Barcelona, has always been one of the most popular tourist destinations in Europe with millions of visitors arriving in the city every year. However, it feels like Barcelona hotels have hard times following the Catalan independence referendum that took place on October 1.

The preliminary data by STR Global only proves that the hospitality sector of the region is suffering losses. Just in five days after the referendum, revenue per available room (RevPAR) of Catalan hotels fell down drastically. October 4 had the sharpest year-on-year decline of 27.5%. Such a drop is not caused by other factors because in August and September hotels in Barcelona posted strong results. Even the terror attack on August 18 didn’t have any significant impact on the occupancy of local hotels.

In both August and September, Barcelona hotels posted their record RevPAR ever – 146.11 euro and 140.75 euro respectively. These figures prove a double-digit increase if compare with August and September 2016. Neither the terror attack nor referendum related protests prevented travelers from visiting Barcelona. The occupancy fell down for a week after the August 18 attack. However, already at the end of the month, all major figures of local hotels recovered.

Such a strong August performance of Barcelona hotels has also become possible thanks to the ESC Congress that took place in the city on August 26-30. The largest cardiovascular congress in the world usually attracts nearly 30,000 attendees. Out of all submarkets in Barcelona, only Sants-Montjuic was able to increase its occupancy by 0.4% and ADR (average daily rate) by 17.6% for the period of August 1 to October 16. In this submarket, there are many hotels located not far from the exhibition center.

Hospitality experts note that Barcelona hotels experience mass cancellations, especially from the group segment that involves 10 or more bookings at once. Political unrest has a definite negative impact on hotels in Barcelona. If there are no drastic changes, the occupancy is likely to fall until the end of the year and might affect ADR as well. Given that 2017 has been generally a strong year for Catalan hotels, they will have a high basis for year-on-year comparison in 2018, and that might result in modest achievements.


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