• Investment funds get in the game with considerable resources.
• Five chains post an annual growth rate of more than 4 000 rooms.
• With more than 4 000 additional rooms in 2005, the French giant Accor remains the leader of the European hotel industry.
• With the take over of Meridien, Starwood Hotels & Resorts joins the Top 10 of European Union hotel chains.

In preview of the detailed results of the European hotel industry, which is carried out every year by MKG Consulting and published in the February/ March edition of HTR, here is the ranking list of the first 10 chains and the first 10 brands among the 140 chains and the 200 brands established in the European Union.

2005 intensifies the trend initiated last year: hotel groups that are established in Europe accelerate their development again. With the consolidation of the demand growth, and the arrival of investment funds that have considerable resources, the European hotel industry could be located in a new cycle of supply growth. The first 10 groups of last year’s classification totaled a progression of 0,5% representing a volume of 3 650 rooms. This year the growth of the 10 leaders in the hotel industry of the European Union reaches 4,3% (28 552 rooms). A majority of the actors that are part of the top 10 ranking in hotel groups and top 10 hotel brands see their supply increase in a clear way during the year 2005.

With the integration of the Meridien brand, Starwood Hotels and Resorts joins the Top 10 of European hotel groups.

One of the major events of the year was undoubtedly the realization of the take over of Le Meridien by Starwood Hotels and Resorts. This take over allows the american group to make a remarkable entry in the Top 10 of hotel chains that are established in Europe. In the European Union, the supply of the chain increases by more than 10 000 rooms in one year!

Four of the hotel chains post increases of more than 4 000 rooms in their hotel supply.

Accor reinforces its position of unchallenged leader on the continent due to a 1,7% increase of its supply hence a volume of more than 4 000 rooms and 38 additional hotels. On the Super-economic hotel segment, the development of Formule 1 is definitely put on stand by whereas the group privileges Etap Hotel that takes an increasingly important place in the European hotel industry landscape. Ibis and Mercure strengthen their position as second and third brands in the ranking. Accor places this year again 5 of its brands in the Top 10. The French group still regroups more than three times the numbers of establishments than its follower, Best Western.

As such Best Western remains the second group in Europe and also records a clear progression in 2005 (4 900 rooms). The result of the american franchisor appears to come from a recovery of the extension of the Best Western network after several years of reduction of its consecutive supply to the implementation of a strategy of "cleaning" its supply (skimming of the units that do not correspond to the brand’s ambitions).

Another European Giant, InterContinental Hotels Group also ensures its development and sees its supply grow by 6,7% in 2005. Holiday Inn benefits in particular from the recovery of new franchise contracts from ex Queen Moat Houses establishments in the United Kingdom. This brand has restarted its growth after the shrinkage of its supply. Another brand of the chain to have favorable winds, Express by Holiday Inn demonstrates the vitality of the budget segment on the other side of the channel. As such Premier Travel Inn, the budget brand of the Whitbread group has seen its supply pursue its growth by 28 units.

Another chain that is amongst the most dynamic in Europe, Carlson has acquired 25% of the shares of its master European franchisor Rezidor. A pledge of confidence in the future developments of the brands of the chain, in particular Radisson SAS and Park Inn. From one year to another, it is thus nearly 5 000 additional rooms which carry one of the brands of the Carlson group.

Behind these remarkable progressions, the supply evolution of the German specialist in leisure hotels TUI or of the American franchisor Choice are not as strong but nevertheless represent a volume of more than 1 000 rooms. In both cases, the observed growth in 2005 is a follow up of the previous year in the reduction of the hotel supply of each one of these groups.

Sol Melia proposes a relatively stable supply from one year to another, counterbalancing the abandonment of the management of under-performing establishments with the signature of multiple franchise contracts in its domestic market.

Lastly, this year 2005 will also have been remembered by the purchase of the Louvre hotels by the investment firm Starwood Capital. The brands of the French group, Première Classe, Campanile and Kyriad, have an especially well established position in France. The slight decline of the group this year is resulting from the loss of several affiliates of the luxury Concorde brand. Furthermore, Starwood capital projects to develop a new luxury hotel network, whose name, Crillon Hotels, takes on the name of the most famous establishment of the Concorde network.

After the period of slowdown that the industry has known these last years, two trends appear to emerge from the results of the year 2005:

• First the hotel chains and generally american investment funds are trying to win market shares on the European market that remains very attractive.
• Second trend: the European heavy weights, Accor and InterContinental Hotels Group, are also very dynamic. With growths of their supply of more than 4 000 rooms, these two groups maintain their position on these very coveted European markets.

• Discover in preview the 2005 results of the hotel activity in France, in Europe and in the rest of the world, presented by MKG worldwide. Like every year you will discover in exclusivity the industry growth forecasts of 2006.
• Exchange your ideas around 2 round tables: Hotel development: investors and hotel operators, a relationship of trust or dependence? Hotel Concept, innovation as a marketing argument. Guy Dano, Louvre Hotels, Eric Gizard, Architect, Michel Gicquel, Research and Style Accor, Gerard Greene, Yotel, as well as other Marketing experts.
• Debate during a lunch with Christian de Boissieu, economist and president of the Counsel of economic analysis to the Prime Minister, on the theme: will the recovery end up being shared worldwide? The debate will be animated by Gérard Bonos, Director of editing of radio Classique.
• Inform yourself on the strategies of hotel chains in the face of the growth of new territories for the coming years during the Strategic Forum to which will participate: Gérard Brémond, Pierre et Vacances, Dominique Desseigne, Lucien Barrière Group, Georges Sampeur, Galaxie B&B, Tom Krooswijk, JJW Hotels …
• Prepare the future through the actions of public institutions presented by Frédéric Pierret, Director of Tourism, in the name of Léon Bertrand, delegated Minister of Tourism.