The European Hotel Survey 2010

5th April 2010 (Last Updated April 5th, 2010 18:30)

Hotel Management International's annual European hotel survey reveals the top hotel groups in Europe. The results also indicate conservative growth over the next year and a positive long-term outlook.

The European Hotel Survey 2010

2009 was a troubled year for the European hospitality industry, hard hit as it was by the global slowdown. The value of global hotel investment deals alone fell by two thirds in 2009. However, 2010 is going to be a pivotal year for the industry. Transactions will increase marginally, particularly as more assets are put under the control of the banks, which will lift hotel transaction volumes. The impact of the recession has varied according to the European location and market segment. “In 2009, some hotels did surprisingly well, while others have done surprisingly badly,” says Mark Wynne-Smith, CEO EMEA at Jones Lang LaSalle Hotels.

Pipeline prospects

With more new openings than new projects, the European pipeline has also been affected. According to Lodging Econometrics, new openings are expected to remain high throughout 2010 before declining markedly in the following year. In 2011, Lodging Econometrics expects 147 projects/27,547 rooms to open. Construction projects are also in decline, while cancellations and postponements continue.

Accor in the black

“Accor remains the largest hotel group in Europe with a total number of 252,273 rooms spread over 12 brands.”

European mega brand Accor remains the largest hotel group in Europe with a total number of 252,273 rooms spread over 12 brands across 24 countries. The group recently announced plans to clear €1.2bn in net debt and cut capital spending through the sale of €450m in hotel properties this year. It is a huge decision and it will be interesting what the knock-on effect will be on other hotel groups. Accor, which owns brands like low-budget Formule 1 and top-of-the-range Sofitel, could launch about 30,000 new rooms in 2010, and increase the number to 40,000 rooms per year by 2012.

Fine tuning IHG

IHG, the world’s biggest hotelier, continues its their expansion with 93,598 rooms as of March 2010 spread over 586 hotels. “The actions we’ve taken in 2009 build on the changes we’ve been making over the last five years to turn IHG into an asset light, high performance, fee-based business,” says Andy Cosslett, CEO of IHG in an exclusive interview with Hotel Management International. “Over the last 18 months the power and resilience of our business model has been thoroughly tested. We’ve proven that our scale, and the strength of our brands, can lead us to gain market share and bring us operational efficiencies whatever the market conditions.” IHG is in the midst of a $1bn rebranding of Holiday Inn, a strategy that continues despite the global downturn. The hotel company, whose brands also include Crowne Plaza, published its annual report in March 2010, which showed that its operating profits fell 34% to $363m from $549m in 2009. IHG did manage to open a record 439 hotels in 2009.

Onwards and upwards for Starwood

As of March 2010, Starwood has 38,528 rooms in Europe. It recently announced plans to open 50 new hotels in its EMEA division by 2012. “With more than 240 hotels in 55 countries in EMEA, we currently have a large enough footprint to enjoy the benefits of being an established and leading hotel operator in the most highly sought-after markets,” says Simon Turner, president of global development. The group’s Sheraton brand is fuelling growth with flagship openings scheduled for Greece
(Sheraton Rhodes, spring 2010) and Italy (Sheraton Milan Malpensa, summer 2010). Beyond Sheraton, Starwood will continue to introduce more of its brands to new markets. For example, after debuting the W brand in Spain last year with W Barcelona, the brand will continue to expand with new openings in high-profile destinations such as London, St. Petersburg, Paris and Milan. And Starwood’s new design-led Aloft brand is set to make its European debut this autumn with the Aloft Brussels Schumann opening in Belgium.

Rezidor pushing though

Despite the downturn, Rezidor is on a roll with 51,774 rooms. The Brussels-based organisation finished 2009 with a record number of openings – 36 new hotels with 7,100 rooms creating 4,000 new jobs across Europe, the Middle East and Africa. “2009 has been a challenging year, but even in tough times, Rezidor believes in growth,” says president and CEO Kurt Ritter.