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News / February 13 2012 - Hotel sector shows signs of improvement

EMEA Hotels Monitor February 2012

EMEA Hotels Monitor February 2012

Hotel sector shows signs of improvement

The EMEA Hotels Monitor recent analyses of trends in the sector found that the volume of transactions in the sector exceeded those achieved in 2010.

The report, which is issued every six months, summarises hotel performance data across 23 cities, hotel construction costs in 30 countries and hotel deals completed.

The UK benefited the most from this upturn in activity, with transactions up by over 150%. Of these deals nearly 30% were distress related, higher than its previous peak in 2009.

However, it is not all good news in the sector, with a range of factors weakening demand and slowing bookings.  These include the Arab Spring, recent riots in Western and Eastern Europe, the first US downgrade in sixty years and the European debt crisis.

The worst performing region was Africa, with occupancy levels down due to political unrest and the drop in visitors and increased supply in South Africa following the FIFA World Cup 2010 significantly affecting the figures.

Lance Taylor, CEO at Rider Levett Bucknall, said: “It is unsurprising that the UK market has been the most robust in the last six months, with operators and investors benefiting from last year’s Royal Wedding and gearing up for this summer’s Diamond Jubilee celebrations and the Olympic Games.

“The longer-term worry will be how the sector copes in 2013, particularly after benefiting this summer. As the findings for South Africa show, oversupply can sometimes result following a major international event and it is up to the sector to look for interesting ways to maintain interest next year.”

The report was produced by Whitebridge Hospitality in partnership with Rider Levett Bucknall and STR Global, which benchmarks hotel data.

Philip Camble, director at Whitebridge Hospitality, added: “Generally speaking, hotel performance levels have held up well in those countries that have enjoyed relative political stability.

“In North Africa and Greece on the other hand, hotel markets have suffered severely and a recovery will only be possible once the political uncertainty is resolved and stability returns to the streets.

“The biggest concern is in new developments; the pipeline is looking even thinner for 2012.”

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News / February 13 2012 - Hotel sector shows signs of improvement