Spanish Hotel Barometer Q3 2021
Hotel industry activity begins to recover at varying rates
- The holiday season confirmed that June was a turning point for the hotel sector. Although the indicators in the Barometer are still far from those preceding the pandemic, the increase in travel activity points towards a recovery that should be confirmed over the coming months.
- During the first nine months of 2021, the average occupancy of Spanish hotels (including closed properties) reached 26%, an approximately 20% increase compared to the same period last year. The average daily rate (ADR) also climbed to around €116, representing a growth of 17% on the figure from last year. These two upward trends combined led to a 41% rise in the average revenue per available room (RevPAR) to €30.
- The recovery trend appears even more pronounced when looking at September data only. Last month, the Spanish hotels recorded nearly 50% occupancy and ADR of €114, resulting in RevPAR of €56. This represents a growth of some 369% compared to September 2020.
Madrid/Barcelona - STR and Cushman & Wakefield jointly produce the Hotel Sector Barometer for Spain, showing an upward trend during the third quarter of 2021, which is the first time since the pandemic started in March 2020. The vaccine rollout and the disappearance of most restrictions have enabled the hotel sector to begin the recovery process. This is expected to be faster within the leisure sector.
Given that the indicators for Spain as a whole have shot up and that it represents the entire hotel stock (Total Room Inventory), whether open or closed, the comparison between September 2020 and the same month this year is the strongest sign of this recovery. Occupancy in September reached 49%, three times more than the 16% occupancy during the same month last year. ADR also grew by 52% to €114. Overall, RevPAR reached €56, a jump of 369% compared to September 2020. This growth in activity reached a peak of 44% in the Balearic Islands, representing an increase of 577% compared to September of the preceding year.
Occupancy reached 26% during the first nine months of the year
With respect to the entire hotel inventory in Spain, the average occupancy over the first nine months of the year reached 26%. Although this figure represents an increase of 20% compared to the same period last year, it is still notably below the occupancy of 76% achieved by hotels during the first nine months of 2019.
The highest occupancy levels for the first nine months of 2021 were recorded in Malaga (44%), Zaragoza (44%) and Alicante (42%). Madrid achieved a figure of 27%, and occupancy in Barcelona amounted to 25%. In contrast, the lowest occupancy levels were seen in the Canary Islands (19%) due to the restrictions on air transport, and in the Balearic Islands (20%) that were additionally hampered by the high degree of seasonality. Nevertheless, the data for the Balearic Islands in September shows a significant turnaround, with a 577% growth in occupancy compared to September 2020.
In the opinion of César Escribano, STR's Country Manager for Spain and Portugal, "this season was undoubtedly the hotel recovery summer, particularly in holiday destinations where we saw occupancy levels and revenue approaching or even exceeding the levels of 2019 in August. Domestic travellers have undoubtedly been the leading players in terms of bookings. This is particularly true with respect to coastal destinations, where occupancies of 90% were reached, along with revenue levels (RevPAR) similar to those of 2019. According to our data, the inclination to travel is increasing and, as a result, we are finally able to predict a strong winter season for the Canary Islands at pre-pandemic levels".
According to Bruno Hallé, Partner and Co-head of Cushman & Wakefield Hospitality Spain, "the indicators from the Barometer help us to point out trends. Nonetheless, it is important to be cautious in comparing the data with 2020, a year in which activity was practically non-existent as of March. Starting from now, the industry must work towards restoring both the holiday and city segments, pursuing this with a reasonable pricing policy that drives activity without undermining value or jeopardising a world-leading tourism brand such as Spain."
The ADR for the first nine months of 2021 reached €116, representing an increase of some 17% compared to the same period last year.
During the eighteen months of the pandemic, the lack of visibility has been putting pressure on hotels' pricing policies. The data shows, however, that the hotel industry has understood the importance of resisting this pressure. During the first nine months of the year, the ADR increased by approximately 17% to €116. This is in line with the pre-pandemic levels in 2019 when the ADR reached €120 during the same period.
The highest prices per room were charged in Marbella (€298), the Balearic Islands (€209), the Canary Islands (€115) and Barcelona (€100). Although Madrid's ADR stood at around €88, the figure for September (€105) appears to point towards a rebound in the coming months. The lowest prices per room were recorded in Zaragoza (€56) and Granada (€68).
In the opinion of Albert Grau, Partner and Co-head of Cushman & Wakefield Hospitality Spain, "hotel operations recovered in summer and, if the pandemic remains under control, we will also see the restoration of hotel price levels to those of 2019. Pressure in energy prices is also a significant item for the sector, meaning that a sensible pricing policy is essential whilst demand recovers".
RevPAR exceeded €30 between January and September, representing a growth of 41% compared to the same period last year.
The declining trend in revenue per available room (RevPAR) during the previous quarters has been reversed and, with the arrival of summer, the average of €30 for Spain as a whole was exceeded. In September alone, RevPAR stood at €56, demonstrating that the recovery is picking up pace. The highest RevPAR figures for the first nine months of the year were recorded in Marbella (€88), the Balearic Islands and Malaga (€43 in both). The lowest levels were seen in Granada (€19), Cordoba (€21) and the Canary Islands (€23). Madrid and Barcelona likewise followed the uptrend in comparison with 2020, achieving figures of €24 and €25, respectively.
The Hotel Sector Barometer brings together data from 1,200 hotels and more than 150,000 rooms in Spain. The study is the product of an alliance between STR, a worldwide provider of benchmarking, analytics and market knowledge specialising in the hotel sector, and Cushman & Wakefield Spain, the world leader in real estate services.
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With more than 30 years of experience in Spain, Cushman & Wakefield covers the entire country. The head offices are located in Madrid (Edificio Beatriz, José Ortega and Gasset, 29, 6º) and Barcelona (Passeig of Gràcia, 56, 7º). For further information, please visit www.cushmanwakefield.es or follow us @CushWake on Twitter.
STR provides premium benchmarking, analytics and market outlook information to clients from multiple sectors. Founded in 1985, STR is present in 15 countries and headquartered in Hendersonville, Tennessee, United States. The international head office is in London, UK and there is another head office for Asia-Pacific, in Singapore. In October 2019, STR was acquired by the CoStar Group, Inc. (NASDAQ: CSGP), the leading provider of the business information on real estate assets, analysis and online markets. For further information, please visit str.com and costargroup.com.
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