Overall economic growth
Overall, a growth can be observed throughout Europe, especially in the Iberian Peninsula, UK and Eastern Europe. In Europe, the Revenue Per Available Room (RevPAR) experienced a 6.1% growth since January 2017. The Occupancy Rate (OR) increased by 2.4 pts and the Average Daily Rate (ADR or room rate) by 2.7%. Midscale and Upscale/Upper Upscale are on a dynamic trend with a RevPAR that has respectively risen by 6.1% and 6.2% after three trimesters.
Still no catastrophe following "Brexit" in the United Kingdom: the RevPAR grew by 7.1%. Edinburgh and London are in the top 3 with the best occupancy rates in Europe. Meanwhile, Germany is on a low positive growth trend: +2.3% of its RevPAR. Some cities are, in spite of a strong business activity, on a downturn trend (Frankfurt, Leipzig, Munich and Nuremberg), while Cologne, Hamburg and Hannover recorded a RevPAR increase of 13.5%, 8.2% and 6.2% respectively. Italy (+5.5%), after a difficult year in 2016, posted an increase in its RevPAR, this positive change can be explained by good results recorded in Florence (+14%), Venice (+17.5%) and Bologna (+12.1%). Rome continues to record negative results (RevPAR: -7.1%) but the occupancy rate remains almost at the same level compared to last year.
From East to West: migration of an improved economic context
Over on the Iberian Peninsula, tourist arrivals have continued to grow as a result of their internal dynamics but more importantly following a large wave of tourism transference from Mediterranean destinations affected by terrorist attacks in recent months (Turkey, French Riviera, Egypt, Maghreb...). As a result, all cities in Spain (+10.6%) and Portugal (+18.3%) have gained a strong RevPAR increase. France showed a growth (+3.7%) thanks to its strong touristic pole: Paris saw a 5.9 point increase in its occupation rate, and a RevPAR rise of 5.4%. Other cities like Bordeaux (8.4%), Toulouse (+3.6%) and Bayonne/Biarritz (8.7%) also recorded a RevPAR increase. After a difficult second semester in 2016, Nice still has not recovered since the beginning of the year and is on a RevPAR decrease (-0.9%), but the perspectives look good for the end of the year. Lille and Montpellier also recorded a RevPAR decrease by 4.3% and 11% respectively.
International conventions and conferences to the rescue
Many destinations have started hosting significant international conventions or conferences as a way to not only improve their economic context but create a knowledge economy. Warsaw posted a RevPAR up by 9.2% thanks to several international conventions or conferences. For example Madrid, following the hosting of many international business meetings this year, or Barcelona, both noted an increase of 18.6% and 12.9% respectively. These big cities are not alone in experiencing a RevPAR improvement: Valencia, Bilbao and Malaga felt a 12% RevPAR increase. Lisbon, which organized but a few international conventions in this first part of the year, also posted a RevPAR increase of 23.1%.
Wien also recorded a RevPAR increase (+3.1%) along with Prague, which hosted many congresses and conferences: this indicator grew by 10.1%, the occupancy rate rose by 2.6 points and the average daily rate increased by 6.5% compared to 2016. Amsterdam, after the organization of international business events, also recorded a RevPAR increase of 10%.
All ECM members have exclusive access to the complete ECM-MKG European Destinations Observatory report with all the graphs and analysis.
1) ECM-MKG European Destinations Observatory report: A report produced by MKG Hospitality and released several times a year by ECM that presents the development of key performance indicators for ECM member cities.
2) RevPAR: Revenue Per Available Room - Occupancy Rate x average price or room revenue divided by available rooms.
3) Occupancy Rate: Number of rooms sold divided by number of available rooms.
4) ADR: Average Daily Rate - room revenue divided by number of sold rooms.
Supported by the European Society of Association Executives (ESAE) and the Union of International Associations (UIA), Headquarters Magazines serve the needs of international associations organizing worldwide congresses.
Supported by the European Management Assistants Association (EUMA), European Cities Marketing (ECM) and Site, MIM Europe is designed for corporate meetings and incentives planners based all over Europe.