March 2024: Europe’s hospitality industry buds early

The European hotel industry is continuing the positive momentum begun last month, with performance indicators showing steady improvement. While the weather in March was less than ideal, the opposite was true for the region’s hoteliers. While Southern Europe continues to be the driving force behind this recovery, with the exception of Greece, Northern European countries are posting increasingly solid performances as the warmer weather approaches.

In March 2024, the European hotel industry recorded an occupancy rate of 66.4%, an increase of +1.1 points compared to 2023 and +10.9 points compared to 2022. Hotel occupancy in Europe is therefore continuing to improve at the start of the year and has risen by almost 6 points since February.The average daily rate is also up on the previous two years (+3.4% vs. 2023 and +21.2% vs. 2022), with an even more marked increase than in the previous month. The price has risen month on month, from €110.4 in February to €116.8 this month.

Buoyant occupancy coupled with a sustainable pricing power strategy are enabling the European hotel industry to post a significant increase in RevPAR of +5.1% compared to 2023, and a leap of +45% compared to 2023. At €77.6 in March, RevPAR continues to climb. The upscale segment continues to lead the way, with occupancy up by +2.1 points, while the midscale and economy categories posted increases of +1.2 points and +0.7 points respectively. Only the budget segment has not yet returned to its 2023 levels (-0.1 points), although it is very close.The budget segment had the lowest occupancy rate in March (61.6%), while the economy segment enjoyed the highest occupancy rate (68.2%), thanks to a quality/price ratio that is attracting customers at a time when inflation is still rife.

Nevertheless, all categories are recording an increase in occupancy compared to 2022, ranging from +2.2 points for super-economy to +14.7 points for top-of-the-range.In terms of ADRs, the trend is reversed, with the budget segment posting the strongest growth (+3.9%), while the upscale segment misses out on the podium (+2.2%). Looking ahead to 2022, all categories will see double-digit rises in their average daily rates, with the economy and midscale segments standing out with increases of over 20%. These strong performances have enabled all segments to post growth in RevPAR, with upscale segment taking the lead with a 5.5% increase, closely followed by midscale with a 5.3% rise. All categories are posting RevPAR growth of over 40% relative to 2022, with the exception of the budget segment (+25.1%).

While January was not synonymous with performance for the European hotel industry, the positive trend that began to emerge in February was confirmed during this third month of the year. While the weather is fluctuating wildly and the economic climate is still not conducive to tourists’ purchasing power, the Old Continent’s hotel business is performing like a charm. Northern Europe is now sharing the limelight with Southern Europe, and it remains to be seen whether the long-awaited return of the sun in April will benefit hoteliers in both North and South.


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