Mediterranean Observer
China, the US and Middle East are leading the global recovery in hospitality with Europe and Asia way behind.
That is according to hospitality data analyst STR, which reported hotel occupancy “still down at the bottom in many markets” in Europe.
But STR managing director Robin Rossmann forecast “a surge of demand” from June and into the third quarter of the year (July-September).
Rossmann said: “China recovered pretty much to the level of 2019 by the end of 2020. Occupancy dipped in the New Year but is back up to 80% of 2019 occupancy. The US is at about 80%.
“The Middle East peaked around December-January and is now at 65% occupancy. Europe is at 20%.”
He reported revenue per available room (RevPAR) in Europe in April was 27% of the 2019 rate. That compared with 84% in China, 64% in the US, 66% in the Middle East and 38% in Asia.
Rossmann said: “The Middle East and China are back pretty much at 2019 rates, driven by rate growth at the top end of the market. The top end has shown the strongest recovery.”
He added: “Dubai shows recovery will not have to be based on sacrificing rates.”
Rossmann reported hotel occupancy in Israel went from 10% to 50% in two weeks in April and said: “Israel shows markets can recover quickly when a high proportion of the population is vaccinated.”
He argued: “The recovery will differ based on the type of demand. The third quarter will see a massive leisure recovery [in Europe]. [But] it’s likely to be the best summer for hotels not reliant on international travel.”
However, he added: “As long as Europeans can travel, Spain will bounce back. Leisure travel and weekends will drive demand in Europe.”
Rossman suggested: “Business travel will take some time.”
He noted: “There will be pressure from the top to reduce business travel. But the focus will be on reducing one-day trips, which is not necessarily bad for hospitality. Perhaps there will be less travel for internal meetings. Travel to meet clients will remain.”
Rossmann added: “There is events business on the books, but it is tentative. The focus will be on domestic events. Big international events will take longer to come back.”
STR forecasts business travel demand in Europe will recover to 50% of its 2019 level by the end of 2020 and to 70% in 2022.
