HotStats European Chain Hotels Market Review – March 2014
Madrid and Warsaw are March Winners
Warsaw hoteliers experienced a 9.9% surge in RevPAR thanks to a 1.5 percentage point increase in occupancy and a 7.9% growth in ARR, most notably fuelled by a 20.6% increase in the Residential Conference segment rate. Additional revenue per available room from food (+4.0%), beverage (+13.2%) and meeting room hire (+7.1%) enhanced TRevPAR levels by 10.1% to €119.81. A 2.3 percentage point decrease in payroll combined with proficient operating cost control and stable overheads resulted in DOPPAR and GOPPAR jumping by 10.7% and 25.1% respectively.
Mind the gap for Dusseldorf and Moscow
Dusseldorf hoteliers managed to increase RevPAR by 2.2% driven by a 2.3% rise in ARR, while occupancy remained virtually flat. However, this performance was cancelled out by negative movements across all ancillary departments, leading to a 0.8% TRevPAR decrease. With DOPPAR also decreasing by 3.9% because of rising operating costs like travel agents commission per room let (+39.6% to €8.67), and with payroll escalating by 1.1 percentage points, GOPPAR went down by 3.1%.
Different city but same story for Moscow hotels in March; the headline performance was positive thanks to a RevPAR growth of 1.9%, but this metric failed to show the full picture. Indeed, revenue per available room derived from food (-11.2), beverage (-9.1%), meeting room hire (-7.5%) and leisure (-11.6%) decreased, and as a result TRevPAR diminished by 1.9%. A general cost increase underpinned by payroll climbing to 27.2% from 20.5% delivered a GOPPAR drop of 19.7%, producing a profit conversion of 42.5% down from 51.9%.
Paris hit by costs
In March, hotels in the French capital experienced almost flat movements across rooms' department indicators resulting in RevPAR increasing by 0.2%, and with mixed performance in ancillary departments TRevPAR showed a similar movement of 0.2%. But a closer examination of costs revealed direct rooms expenses per room let increasing by 5.2% which led to a DOPPAR deterioration of 0.4%, and with overheads per available room rising by 0.8% driven by administration and general (+4.2%) and property and maintenance (+2.1%), GOPPAR declined by 1.4%.
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