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Hotel rate rises outstrip inflation in Europe and US

Average hotel room rates in Europe and the US rose faster than inflation in July despite overall occupancy remaining flat.

Hotels industry analyst STR reported occupancy in Europe almost flat year on year, down 0.4% to almost 77%, in July but the average daily rate (ADR) up 3.9% on a year ago to almost €119.

London hotels saw a negligible rise in occupancy despite the fall in the sterling exchange rate following the EU referendum on June 23. However, the average daily rate in the city rose 3.8% to £155.47.

STR also reported average occupancy flat in the US but the average daily rate up 3% to $124.

Los Angeles saw a near 10% rise in average daily rate on a year ago to almost $197 per room. By contrast, New Orleans, Boston and Houston saw sharp falls in occupancy and double-digit declines in revenue per available room (RevPAR).

By contrast, STR reported a sharp rise in occupancy in Dubai, up almost 18% to 67.5%, but the average daily rate in the city fall 8.6% in the month to $147.

Qatar suffered a near 7% fall in occupancy to 53% in the same period and the average daily rate fell 1% to $135.

Remarkably, Tunisia saw its highest hotel occupancy rate since October 2014, hitting 55% despite continuing UK Foreign Office advice against travel to the country. Average room rates in Tunisia stood at $85 in July.

In Asia, STR reported occupancy in Bangkok up 4.7% year on year in the month and the average daily rate up 4% to $94.

In China, occupancy in Shanghai was above 80% and the average daily rate $89.

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