Hotels in major centers of Europe and the Middle East are leading in revenue per room with seven points ahead in the world ranking top 20, according to Deloitte’s annual report on “Development prospects in the tourism sector“.
Tourism industry noted a significant global decrease in 2008, especially during the last quarter due to the economic crisis that impact on business and holiday tourism. Despite the decline, however, there are world centers that have achieved good results.
Six cities – New York, Abu Dhabi, London, Dubai, Paris and Tel Aviv, have secured their position in three forms of the top 20 ranking in Deloitte – employment, average room price and annual revenue per room.
The ranking examines the performance of hotels for two periods. In the first half of 2008 most regions of the world reported two-digit growth in revenue, obviously still affected by the crisis. But in the summer, the confidence of customers lowered and tourism began to incur losses.
In the last quarter of 2008th, revenue per room in many regions reaching negative values. At the end of the year, Central and South America and the Middle East are the only regions with two-digit growth in revenue per room, with 14.5 percent and 18.3 percent, while Asia-Pacific region and Europe have less than 2 percent growth in U.S. dollars in this indicator. Last Friday was North America with a decrease of 1.6%.
The effects of the global economic crisis affected the tourism. The financial chaos, which contributed to the crisis in the last quarter of the year, reduced the costs for travel and recreation by both private individuals and corporations. If we look ahead, the threat of deflation may be an even greater problem.
Europe leads with 10 positions in the top 20 in average price per room and 7 in revenue per room. Nevertheless this strong presence in both ratings, the results for hotels throughout Europe deteriorated and at the end of the year finished with negative values decreased by 5.1% to € 70.
PARIS
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Paris is the only city in the euro area, which is present with the three types in the Top 20 ranking. The French capital is in sixth position in the revenue per room, with a growth of 4.8%, reaching € 141, and the ninth in a hotel room rate for an average price per room from € 181. Despite the small decline in employment rates of 77.8 percent, though it was enough for fourteenth place in the prestigious Top 20 ranking in employment.
LONDON
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London continues to count growth in the hotel results and is in the three types of ranking. The employment increased from 0.8% to the impressive 81.1%, which provides a fifth place in the world ranking. The average price per room increased from 4.4% to £ 117, making it the seventeenth by prices and ninth in revenue per room in the Top 20 ranking with £ 93. In response to the effects of the current recession in the UK budget sector saved and ensured profits, while the average boutique hotels dropped the price and had significantly slower growth rate. This shows that private and business customers prefer to choose the better options for hotel accommodations when their are in London.
BERLIN
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Berlin hotel revenues were not high enough to be ranked in the Top 20 cities, but still have positive growth. While the average price per room rose by 6.2 percent, employment fell by 2.3 percent, leading to growth in revenue per room index by 3.7 percent to € 61. According to the Berlin Tourism Organization, the number of tourists own for the first time fell from 2003 onwards. This is a consequence of the decrease in consumer confidence, high inflation and lack of major attractions, to attract the masses. Domestic tourism remains an important element in the tourism mix of Berlin with its 60% of the total business. This year, own and foreign tourists will have the occasion to celebrate as the city notes the 20 anniversary of the fall of the Berlin Wall and 60 years since the creation of the Federal Republic of Germany. Berlin will also host the World Athletics Championship in August 2009
“The strategy of the tourism industry this year will be to survive”, says Alex Kirakidis, Managing Partner of Tourism and recreation industry in the Deloitte Worldwide. The hotels in particular will need to focus on providing more value for money that their customers pay, and on what they do best. Basic hotel services are key when hotels compete for accommodation, he added.
It is important that countries invest in infrastructure development of the tourism industry, including the expansion of airports and hotel facilities, once again being awarded credits. This is necessary in the long term development and sustainability of the industry.
According to the World Tourism Organization, the first half of the 2008th shows 5 percent growth in international tourists, but the growth has reached negative values in the second half, a total of 2 percent growth for the year. Although growth was a slower pace than that of 7% for 2007, 16 million more people have traveled the world and has been a new world record tourist visits of 924 million.
