Hotel News Now each week features a news roundup from a different region of the world. Today’s compilation covers Europe.
Europe hotel performance strong
The European hotel industry posted positive results during January in year-over-year metrics when reported in U.S. dollars, Euros and British pounds for January 2014, according to data compiled by STR Global, a sister company to Hotel News Now.
“2013 served as the beginning of the recovery for most of Europe’s economies and the hotel industry as a whole,” Naureen Ahmed, manager of marketing & analysis, said, adding that hotel demand grew 3.3% for the year.
“However, this came at the expense of rate. Revenue per available room remains €4 ($5.49) from pre-recession levels achieved in 2007,” Ahmed said. “Southern Europe’s 6% RevPAR growth was one of the pleasant surprises of 2013. It is coming from a low base; however, it’s encouraging to see some growth in occupancy and ADR in the countries from these regions.”
England, Istanbul, Moscow lead Europe pipeline
The Europe hotel development pipeline comprises 871 hotels totalling 141,828 rooms, according to the January 2014 STR Global Construction Pipeline Report.
Among the region’s key markets, London reported the largest number of rooms under construction with 5,765 rooms. Four other markets ended the month with more than 1,500 rooms under construction: Istanbul, Turkey (4,349 rooms); Moscow, Russia (2,232 rooms); Berlin, Germany (2,225 rooms); and Amsterdam, Netherlands (1,763 rooms).
Scandic acquires Rica, expands Norway base
Stockholm-based Scandic Hotels extended its footprint in neighboring Norway by buying peer Rica Hotels, based in Billingstad, Norway. Before the deal, Rica had 72 properties—65 in Norway, seven in Sweden—while Scandic had 151 properties, including 19 in Norway. The jewel in Rica’s crown is the Grand Hotel Oslo, which is part of the deal but will maintain its name.
UK authority closes rate parity investigation
The United Kingdom’s Office of Fair Trading has closed its case on rate parity across Europe, allowing suppliers and third-party intermediaries to continue to offer discounted rates to “fenced” groups.
In the investigation into Booking.com, Expedia Inc. and InterContinental Hotels Group, the OFT has accepted commitments from the companies that hotel managers who deal with these three businesses will only offer discounts to travelers who have signed up for a membership or have made a previous undiscounted booking with the online travel agency or supplier in question.
Three-year rate lows seen across Europe
Hotel prices in France, Italy, Poland, Portugal, Turkey and Cyprus have dropped to three-year lows, according to the February Trivago Hotel Price Index.
Poland led the declines with a 57% decrease in rate, followed by Cyprus (-52%), Turkey (-51%), Italy (-39%), Portugal (-36%) and France (-33%). In the 23 most popular countries on Trivago, rate has fallen by an average of 7% over a year-on-year basis.
Manchester hotels see uptick in 2013
The Manchester hotel industry saw positive demand and RevPAR growth during 2013, according to data compiled by STR Global.
2013 daily data comparisons show weekday occupancy and rate growth outstripped the slowing growth achieved on the weekend, indicating the business segment is resurgent and will fuel the remainder of Manchester’s recovery. In actual terms, weekday RevPAR for 2013 still finished £9.13 ($15.21) behind the weekend average of £56.73 ($94.54).
Deals and developments
- Marriott International sold its leasehold interests in the Renaissance Barcelona Hotel to an affiliate of the Qatar Armed Forces Investment Portfolio for approximately €78 million ($107 million), including €45 million ($62 million) cash and the assumption of €33 million ($45 million) of related obligations. The hotel will continue to be operated by Marriott under a long-term management contract.
- Hyatt Hotels Corporation, which on 30 January opened the 330-key Hyatt Place Amsterdam Airport in cooperation with Hillgate Properties NV, will open another Hyatt Place property close to London’s Heathrow Airport in spring 2015. The agreement with Magill Investments Limited—the first for the brand in the U.K.—will be for a 170-key property in a 12-story office conversion.
- Hyatt also will build its first Andaz property in Munich, in cooperation with German developer Jost Hurler Beteiligungs-und Verwaltungsgesellschaft mbH & Co. KG. To open in 2017, the Andaz Munich will have 274 keys and will be in the city’s central Schwabinger Tor district.
- Carlson Rezidor Hotel Group will convert the Minos Imperial Luxury Beach Resort & Spa, in Milatos, Crete, into its first hotel on the island, The 318-room Radisson Blu Beach Resort, Crete Milatos, which is scheduled to open in the second quarter of 2016.
- Carlson Rezidor also will make its debut in the Yorkshire, England, city of Hull. With developer Manor Property Group, it will open the 168-key Radisson Blu Hotel, Kingston upon Hull, which will be part of the £100 million ($166 million) Manor Point mixed-use development. The hotel will open in the fourth quarter of 2016, just in time for the city’s role as the United Kingdom Capital of Culture 2017.
- Steigenberger Hotel Group is to operate one of its economy sector properties in the Dutch city of Rotterdam. The 180-room InterCityHotel Rotterdam will be close to the city’s main rail station, open in 2017 and be developed and owned by Weena Boulevard C.V., a subsidiary of LSI Beheer B.V.
Compiled by Terence Baker.