Global average daily rates (ADR) rose 6.3 per cent year-on-year in July, aided by higher rates in Europe, data from CoStar has found.
Average daily rates in Europe during the month of July rose 13.4 per cent compared to 2022, contributing to the increase in the global ADR. In Europe, France led the way, with ADR jumping 36 per cent year-on-year. The UK and Germany recorded a 6 per cent increase in year-on-year ADR and Germany was up just 3 per cent.
Rates in Europe even surpassed pre-pandemic figures, with ADR for hotels across Europe in July up 47 per cent compared to the same period in 2019. Compared with 2019, ADR in France was up 87 per cent, Italy was up 31 per cent, Spain was up 30 per cent and Germany recorded an 18 per cent increase.
Why it matters
This increase in ADR indicates a strong revival for the hotel sector especially in Europe, particularly post the pandemic-related downturn. However, it’s important to note that while ADR has continued to climb, surpassing pre-pandemic levels, occupancy has remained low, with occupancy in Europe down 4.2 per cent from 2019 levels and up only 1.1 per cent from July 2022. Although skyrocketing ADRs may seem attractive, the stratospheric increases may be having an adverse impact on occupancy.