European Chain Hotels Post February Outcomes

Berlin enjoyed the strongest growth in average room rate in February according to the latest HotStats survey of ten European Cities by TRI Hospitality Consulting.

Hotels in the Berlin sample showed a 14 percent increase in achieved average room rate to €164.44 driven by the Berlinale, an 11-day film festival and key networking event in the international film industry calendar.

Meeting and convention business generated 4.48 million bed nights in Berlin in 2007, a year-on-year increase of 11 percent, according to the city’s convention office.

Although Berlin’s hotels were by no means full this February, the substantial hike in rate meant that payroll as percentage of total revenue fell and income before fixed charges (IBFC) per available room increased by an impressive 31.7 percent to €47.50, making Berlin the fourth most profitable city in the survey.

Chain hotels in Paris showed both the highest room sales growth and the best absolute room sales performance, with RevPAR increasing by 15.3 percent to €152.78.

Yet, as was the case in January, Paris’s profitability continued to be hampered by high payroll costs. Although the French capital resoundingly beat its UK counterpart on rate and RevPAR, the same hotel bedroom in London generated one third more profit than its equivalent in Paris. IBFC stood at €62.05 per available room in Paris compared to €95.13 in London.

Despite a fall of seven points, Amsterdam had the third highest occupancy in the survey at 72.4 percent and also the third highest absolute IBFC PAR at €54.98.

Looking at the year-to-date figures for Budapest and Vienna, notwithstanding significant increases, occupancy remained relatively low. In the two months to February, Budapest had the lowest occupancy in the survey at 54.1 percent.

Still, the 5.9 point occupancy improvement in the Hungarian capital was a key driver of the extraordinary 130.6 percent rise in IBFC PAR, albeit from a very low base in the same period a year earlier. Similarly, a 4.5 point occupancy increase in Vienna helped IBFC PAR rise by 40.8 percent.