HotStats European Chain Hotels Market Review – November 2014
Budapest and Munich hotels take the lead
Both Budapest and Munich hoteliers reported significant year-on-year increases in gross operating profit per available room (GOPPAR) by 25.1% and 52.8% respectively, according to the latest data from HotStats.
November was a strong month for hotels in the Hungarian capital with increases in average room rate (ARR) of 10.4% and occupancy of 7.2 percentage points, leading to a rooms revenue per available room (RevPAR) growth of 21.9% to €64.66. A closer look at the segmentation for the month demonstrates that all segment rates increased with Residential Conference rate (accounting for 16.7% of the business mix) being the only exception that declined by 2.0%. Other prominent segments in terms of rooms sold were Corporate (30.6%), Leisure (27.4%) and Tours/Groups (9.9%) with rates increasing by 12.3%, 10.7% and 20.7% respectively. With mainly positive movements recorded in non-rooms revenues, total revenue per available room (TRevPAR) rose by 15.2% and cost control helped to deliver the GOPPAR growth of 25.1%.
Munich forged ahead among other European cities by recording the highest GOPPAR uplift of the month, namely 52.8% compared to the same period last year. A double-digit surge in RevPAR (+24.3%) driven by a 19.1% increase in ARR and a 3.3 percentage point leap in occupancy, fuelled TRevPAR levels (+20.5% to €164.69) together with a general increase in non-rooms revenues. A similar look at the segmentation reveals that all segment rates surged in November, with the Corporate segment representing 38.2% of the total rooms sold. Astute operating cost control together with payroll declining by 5.4 percentage points further improved the performance, leading to a GOPPAR surge of 52.8% to €63.80.
RevPAR flatters to deceive in Madrid and Vienna
Madrid hoteliers managed to simultaneously increase occupancy by 0.7 percentage points to 63.6% and ARR by 2.5%, resulting in a RevPAR growth of 3.7% to €79.97. However, mixed performances recorded in non-rooms revenues softened the TRevPAR surge to 0.7%. A slight increase in payroll of 0.2 percentage points combined with a weighty surge in overheads per available rooms (+4.0%) prohibited hotels from converting revenue gains to the bottom line, with GOPPAR showing year-on-year negative movements of 1.1%.
In November, hotels in the Austrian capital boosted ARR by 2.3% at the expense of occupancy (-1.3 percentage points), leading to a 0.4% uplift in RevPAR. Yet hoteliers in Vienna also experienced disappointment despite the RevPAR growth. Indeed, mixed performances in ancillary revenues resulted in TRevPAR falling by 1.7% and departmental operating profit per available room (DOPPAR) also declined by 9.2%. Increasing overhead and payroll costs did not help the overall performance and GOPPAR dropped by 22.6% to €26.33 compared to the same period last year.
Challenging November for Istanbul
Hotels in Istanbul registered negative year-on-year comparisons across all key performance indicators for the month of November. Both occupancy and ARR declined by 2.8 percentage points and 6.7% respectively to deliver a RevPAR drop of 10.3%. A general decrease in non-rooms revenues led to a TRevPAR fall of 12.1% and DOPPAR went down by 17.8%. Despite overheads per available room remaining virtually flat, payroll climbed by 4.9 percentage points and contributed to a GOPPAR decline of 29.4%.
The hotels profiled in this report are drawn from the HotStats database and reflect the portfolios and distribution of the hotel chains that we survey and which operate primarily in the four and five-star sectors.
Please note: The data samples are reviewed and rebased each year to reflect the changes in the HotStats survey base. As a result, performance ratios published last year may differ from those contained within this report.
Occupancy (%) is that proportion of the bedrooms available during the period which are occupied during the period.
Average Room Rate (ARR) is the total bedroom revenue for the period divided by the total bedrooms occupied during the period.
Room RevPar (RevPAR) is the total bedroom revenue for the period divided by the total available rooms during the period.
Total RevPar (TRevPAR) is the combined total of all revenues divided by the total available rooms during the period.
Payroll % is the payroll for all hotels in the sample as a percentage of total revenue.
GOPPAR is the Total Gross Operating Profit for the period divided by the total available rooms during the period.
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