Industry Update
Press Release17 February 2012

Top-10 Hotel Groups in Europe

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MKG

  • Data collected directly from groups by the database at MKG Hospitality made it possible to list the top-ten hotel groups in Europe (27 countries).
  • While the leading groups have not lost their positions, changes may be felt elsewhere in the ranking with a few changes in positioning. Carlson Rezidor Hotel Group and Whitbread Hotels, already present in the Top 10, have risen among the ranks.
  • While organic growth in the hotel chain supply in Europe is real, the best scores are the result of internal restructuring rather than the arrival of new inventory on the market.

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The ranking of hotel groups in the European Union continues to be dominated by the Accor Group, which has three times more rooms than its strongest competitor, Best Western. The difference is increasing since the French group boosted its growth through increased franchising. Of the 40,000 rooms opened worldwide in 2011, one quarter are in France and another quarter in the rest of Europe. Accor Group alone accounts for one-third of the total supply of the top-ten European groups.

Best Western, meanwhile, generally consolidated its network while Intercontinental Hotels Group, focused on its Holiday Inn New Generation, while losing a few InterContinental contracts in Germany.

The hotel division at Groupe du Louvre, which associates the economy and upscale segments of the Louvre Hotels Group with the luxury properties in the Concorde Hotels network, is strengthening its position in 4th place. After a period of reorganization, the brands Campanile, Kyriad and Concorde members are back on the growth track.

The first change came with the rise of Carlson Rezidor Hotel Group, the new name of the EMEA subsidiary of the Carlson Hotels group, which was particularly dynamic with many openings under the Radisson Blu and Park Inn brands. The growth would be even greater if it included the many openings in Central and Eastern Europe and in Northern countries outside the European Union.

NH Hoteles, which is prey to financial restructuring problems, is not currently in a strong growth phase and is managing programs launched prior to the crisis, including the opening of its flagship in Berlin. The group, in its quest for a financial ally, slipped down a rung. The second noteworthy change in the ranking is Whitbread with its three-rung climb thanks to the dynamism of its economy brand Premier Inn. The concept experienced strong growth in Great Britain with new constructions and many conversions of independent hotels to enter city centers. The pipeline already includes 11,000 additional rooms, boosted by the Olympics in London.

The Spanish group Melia Hotels International is also stabilizing due to a difficult domestic market. Hilton Worldwide takes advantage of the arrival in Europe of brands developed in the United States, especially DoubleTree and Garden Inn. The group benefits in particular from the support of its owner Blackstone, which continues to purchase properties to accelerate its implantation in Europe. It is also strengthening its presence in Eastern Europe.

Victim of bad financial results for its Tourism division, the German leisure group TUI is selling off its hotel properties, which consist of partnerships with local groups in Spain and Greece.

"The European market is prey to permanent restructuring leading to the disappearance in mature countries of thousands of obsolete rooms that no longer correspond to market needs. Their replacement with a new supply from hotel chains is only very partial," observes Georges Panayotis, President of MKG Group.

"Market shares of hotel groups are growing on a shrinking market. Broad recourse to franchising is increasingly leading to the transfer of resources from independent hotels to chain hotels. We may congratulate ourselves for significant improvement of the product thanks to more demanding standards, but an obvious need remains for new constructions to avoid finding ourselves in a shortage on the major tourist markets. Even in the United Kingdom, where Whitbread's growth appears spectacular as it prepares for the Olympics in London, a major portion of the new supply is a result of conversions. Europe must rapidly adopt incentive policies to encourage new building," continues MKG's President.

(NB : the ranking of the top 10 hotel groups does not take into consideration commercial partnerships that distribute hybrid brands)

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Georges PANAYOTIS
Founder, Chairman & CEO
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