In February 2025, European hotel performance reflects a changing landscape, driven by contrasting geographical dynamics and a gradual rebalancing of fundamentals. While stability prevails across the continent as a whole, some regions are doing particularly well, driven by cyclical or structural factors.
There’s no wrong note when it comes to the performance of European hotels by segment. Nor are there any flights of fancy, with OR stagnating at between -0.1 and 1.9 points, depending on the range. Boosted by international customers, the mid-market and upscale segments posted RevPAR growth of 2.7% and 3.2% respectively. The euro/dollar exchange rate is still very favourable for customers whose currency is pegged to the dollar. The budget and economy segments are showing perfect stability, without yet giving up on average daily rates.
European hotel trends: February 2025 – RevPAR : 2/2024 VS 2/2025 par Hospitality ON— Source: HSMAI Europe
A podium in Eastern Europe
The three biggest increases in RevPAR were in Eastern Europe. Hungarian hoteliers boosted their RevPAR by 17% on the back of a 5.6-point increase in OR and a 5.8% increase in ADRs. As a result, the destination is closing in on the 60% occupancy mark, reaching 58.3%. Latvia ranks second in terms of RevPAR growth, with an increase of 13.3% and the strongest OR growth at 10.2 points. However, as in 2024, the ADRs are down (-6.6%), making the destination the most competitive of the panel observed. Poland closes the performance podium with an 8% increase in RevPAR, driven by a 4.5% rise in ADR and a 2-point increase in OR.
As Adrien Lanotte pointed out in his 2024 review interview with Hospitality ON: I watched with some interest the rebound at the end of the year in Central and Eastern Europe (Poland, Hungary, Czech Republic, etc.): this has yet to be confirmed, but it would be entirely logical for the trend to continue. In a context of budgetary arbitrage for Europeans, these destinations are attractive for leisure customers with lower prices, and business customers with cheap labour. This is where new mega-factories for batteries and other products are being set up, while they are closing down elsewhere.
The mountains are boosting Alpine destinations
+5.2% RevPAR in Austria, which welcomed 175,000 people to the FIS Alpine World Ski Championships Saalbach 2025. +Austria’s RevPAR is up 2.2 points. Switzerland is also benefiting from the attractiveness of its Alpine territory at the height of the winter sports season, with OR up by 3.1 points and prices logically stagnating, given that they are the highest on the panel (€218.1).
As for France the mountains and the performance of Lyon, boosted by a large number of events, put the Auvergne Rhône Alpes region in the lead in terms of RevPAR (excluding the Paris region).
Southern Europe: a slowdown in February, but a price effect was expected
Spain and Portugal showed the most pronounced slowdown, with a drop in visitor numbers in both destinations. Italy is doing well among Southern European destinations, with RevPAR up by 5.9% (5th best performance on the panel). The first part of Fashion Week in Milan (25 February), coupled with the Carnival festivities in Venice, which began on 22 February, and the hosting of a match in Rome in the 6 Nations Tournament, fueled growth.
Europe’s core markets are performing well
Germany is continuing the upturn that began in January, with RevPAR up by 6.8% driven by occupancy up by 2.3 points and ADR up by 2.8%. The Netherlands, which suffered in January, is recovering with RevPAR up by 3.9%. In value, it has the 4th highest RevPAR of the panel (€130.2). The destination remains attractive despite the sharp increase in tourist tax.
The lights are also on in the UK, with RevPAR up 1.2%.
After a year in 2024 in which performance was largely driven by the economic climate, the structural foundations of the hotel business in Europe are gradually shifting. The southern countries have caught up with the northern ones in terms of average daily rates, leaving the way clear for Eastern European destinations.
Article by MKG
About HSMAI Europe
HSMAI – Hospitality Sales and Marketing Association International – is a global organisation founded in the US in 1927. HSMAI Region Europe is the European arm of the organisation. HSMAI Europe aims to be a key influencer, pioneer and the go-to industry resource for professional development, commercial strategies and sustainability in the hospitality, travel and tourism industry. With a strong focus on education, HSMAI has become the industry champion in identifying and communicating trends in the hospitality industry while operating as a leading voice for both hospitality and sales, marketing, and revenue management disciplines.
HSMAI Europe
HSMAI Europe
View source
Please visit:
Our Sponsor