Hospitality shows upward trajectory in Q4 and beyond
In addition to the uptick in occupancy, the industry is witnessing a boost in revenue per available room (RevPAR), which has surged by an average of 17% in 2023 compared to 2022. France stands out as a front-runner, with its RevPAR soaring to 123% above the global average. Notably, in June, French hotels achieved a staggering $422 in RevPAR, surpassing the US by a substantial 220% during the same period.
Amadeus’ data also points out that the United States is experiencing a stronger trend in hotel occupancy during Q4, with a 5% increase compared to 2022. Additionally, RevPAR in the US has seen a steady 8% rise within the same window of comparison. Hawaii is tracking in the top 5 markets for NORAM heading into Q4. With the recent wildfires in Maui there has been discussion around the need for tourism in the area to help with financial recovery while also being considerate of rebuilding the region.
Europe is emerging as the frontrunner in the global hospitality resurgence, surpassing the United States in occupancy for the first time in 2023. Looking forward to the final quarter of the year, Europe is leading the pack, with on-the-books reservations already 20% ahead of the worldwide average. Key cultural destinations like Florence, Rome, and Athens have enjoyed robust occupancy rates throughout the summer, with further growth expected as the cooler months approach.
Hotel occupancy worldwide from January to August 2023 inclusive is around 10% higher on average over this period than in 2022. Amadeus’ Demand360 data shows that the sector is continuing to stabilize and is becoming more predictable as bookings start to consistently follow historical trends and patterns.
Short-term rentals and group bookings show promise
Global occupancy in short-term rentals from January 2023 to August 2023 has been an average of 41% occupancy per month. Short-term rentals have so far recorded the highest occupancy in July 2023 (47%).
Amadeus also emphasises that group travel is important for hoteliers as it tends to be booked further in advance and provides a strong financial foundation. There are more groups traveling in 2023 than seen in 2022 and the data shows that group bookings are just 17% behind 2019 over the course of 2023. Worldwide, group occupancy in hotels is now an average of 12% per month year to date. The peak month in 2023 to date has been June, where worldwide group occupancy was 14%.
In 2023, group travel will hit a high in October where group occupancy is currently 16%.
Cultural events and its impact on surrounding economy
According to Amadeus, events play a pivotal role in driving occupancy and RevPAR. For instance, the Rugby World Cup has ignited demand in France, with host cities experiencing a notable uptick in hotel occupancy. Paris and Nice are up 5% compared to the same period in 2022, while Marseille has witnessed a 7% increase, indicating a heightened demand for accommodations during the event.
Cultural events featuring international stars are also contributing to increased hotel bookings. Music concerts and festivals have hit the headlines again in 2023 for driving regional tourism significantly. From Taylor Swift and Coldplay to Beyonce, most international capitals have benefitted from stars choosing their cities for their performances.
Beyoncé’s Renaissance World Tour, for example, led to a significant surge in hotel demand in Seattle. The record-setting superstar played at Lumen Field on September 14th – Amadeus’ data shows that hotel occupancy for September 9th-11th in Seattle averaged 83%, rising to 96% from September 12th-14th as fans flocked to the city for the concert, resulting in a 36% boost in occupancy compared to the same night in 2022.
Between September 15-17 occupancy fell back to an average of 82% and ADR dropped to $202.
The importance of data in decision-making
This report highlights the significance of data in guiding strategic decisions for hoteliers. Amadeus says access to comprehensive and reliable data is essential for shaping marketing, revenue management, and operational strategies.
Katie Moro, Vice President, Data Partnerships, Hospitality, Amadeus, said, “Access to complete and credible data that can be trusted, gives hoteliers the insights they need to help drive bookings and guide marketing, revenue management and operations strategies. For example, a shift in available short-term rental properties in a market will have an impact on potential occupancy for hoteliers. Market dynamics are constantly shifting, and it’s important to track them closely and be able to move quickly to seize competitive advantage.”
