France and UK Lead European Hotel Industry During First Half of 2005
During the course of the first semester of 2005, France and the United Kingdom continued to see excellent results, with rises in RevPAR that totalled 3.3% and 5.9% respectively. France's Mediterranean neighbours, Spain and Italy, registered greater difficulties, which only highlighted the performance of France.
In the United Kingdom, hotels continued to post excellent results with an average rise in RevPAR of 5.9%. The United Kingdom began its recovery phase quite early, and the sustained levels in demand imply particularly high average occupancy rate levels. This trend continues, and occupancy rates continue to climb in this semester. After having already seen an exceptional year in 2004, with a sustained rise in average daily rates (+6.4% over the year), the room for manoeuvring may nonetheless be lessened in upcoming months for increases in average daily rates already rather high (nearly 120 euros). It is still too early to assess the potential impact of the terrorist bombings in London on the British hotel industry, though the tragic events that have affected London may lead to a drop in leisure customers in the second semester.
Germany, where hotel results are particularly strongly correlated to trade fairs and commercial exhibitions and shows and to business activity, registered switchback results during the course of the first semester of 2005. In April 2005, German hoteliers posted the largest rise in 5 years (+22.5% increase in RevPAR), before experiencing a month of May far worse (-17.1%). Overall, over the first six months of the year, the necessity of increasing occupancy rates among the lowest in Europe, has led to ever more aggressive rate policies in order to attract new customer segments. Within a context of week economic growth, average daily rates remain down and RevPAR levels unchanged versus the first semester of 2004.
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