Profit continues to increase in most European hotel markets in spite of falling average occupancy, according to the latest HotStats survey of ten European cities by TRI Hospitality Consulting.

France and Budapest were the only cities where hotels were able to increase in demand in the four months to April 2008 of the 10 European cities.

In most markets, however, the drops in occupancy were compensated by good rate growth, resulting in improved overall room sales and profit.

“In most cases, falling overall occupancy has not deterred hoteliers from continuing to push rates upwards. However the negative impact of weaker demand on revpar growth is clear to see and illustrates the generally slower economic conditions that are prevailing across most of Europe,” said Jonathan Langston, managing director, TRI Hospitality Consulting.

The biggest drops in income before fixed charges per available room (IBFCpar) were seen in Munich (down by 18.6%), Prague (down by 22.9%) and Warsaw (down by 4.8%).

Budapest achieved the biggest rise in IBFCpar, which grew by 29.5% to €25.68, but was the least profitable city in the survey.

The figures are compiled each month by Tri Hospitality Consulting.
To find out more, download European Chain Hotels Market Review – April 2008.