Hotels in Europe finished the year on a high note, recording a 7 per cent increase in profit per room in December.
The latest worldwide poll of full-service hotels from Hotstats shows European properties maintained steady growth in December 2017. Room occupancy increased 0.4 percentage points to 59.8 per cent, while achieved average room rates went up 4.2 per cent to €145.26, which contributed to a 4.9 per cent year-on-year increase in revpar to €86.87.
However, the news isn’t so good for the UK hotel market, where revpar dropped 0.1 per cent to £81.90. Profit was hit by a 0.5 percentage point increase in payroll costs to 27.8 per cent of revenue – in spite of a 1.8 per cent saving in overhead costs. As a result, GOPPAR dropped to the equivalent of 38 per cent of total revenue.
Ancillary revenue is also on the rise, with European hotels reporting a 3.5 per cent increase in food and beverage, 4.9 per cent growth in conference and banqueting, and a 1.9 per cent rise in leisure. This contributed to a trevpar increase of 4.2 per cent to €144.70.
Despite December’s room occupancy levels being below the annual performance, corporate bookings contributed to hotels recording increases in average room rates (up 9.4 per cent), along with residential conferences and individual leisure (up 3.8 and 6.7 per cent respectively).
Pablo Alonso, CEO of Hotstats, commented: “December is always a tough month of trading with the interruption of the Christmas break and whilst the performance at hotels in the UK this month will be somewhat of an anti-climax, owners and operators in the UK will be pleased that losses have been minimised and it has been a pretty positive year overall.”