industry landscape ihif 2014
TRANSCRIPT
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The Industry Landscape Elizabeth Winkle Managing Director, STR Global IHIF Berlin
3 March 2014
Global Trends
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• Global Overview
• Top Trends to Watch for Europe
• Outlook
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RevPAR growth in most regions YE 2013, % change USD, Europe (€)
- 4.1%
+ 5.3%
+ 4.7%
+ 1.7% €
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Demand growth outpaced supply growth
-2%
0%
2%
4%
6%
8%
10%
NorthAmerica
Central- SouthAmerica
Europe Middle East Africa Asia Australia &Oceania
SupplyDemand
% change YE 2013
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Back to Peak? Revenue generator index on YE 2008
0.7
0.8
0.9
1
1.1
1.2
2007 2008 2009 2010 2011 2012 2013Europe € USA $
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Europe Demand Accelerating? 12 MMA % change
-6%
-4%
-2%
0%
2%
4%
6%
8%
Jan 10 Jan 11 Jan 12 Jan 13
USA Europe
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Demand, demand and more demand
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Demand growth for 46/49 months; since Dec ‘09 Monthly Demand % change
-15
-10
-5
0
5
10
Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13
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Limited Supply Growth; Strong Demand Growth
-6%-4%-2%0%2%4%6%8%
2010 2011 2012 2013
Supply % ChgDemand % Chg
12 MMA Nov ‘10 +6.8%
Dec ‘13 +3.3%
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Similar Supply/Demand Trends by Class
0%1%2%3%4%5%6%
Luxury UpperUpscale
Upscale UpperMidscale
Midscale Economy
Supply % ChgDemand % Chg
YE 2013
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Rate: the only way is Up?
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Incongruence between Demand and ADR performance
-12%
-9%
-6%
-3%
0%
3%
6%
2010 2011 2012 2013
Occ % Chg ADR % Chg
12MMA
Dec ‘13 2.4%
May ‘11 5.8%
Jan ‘11 5.4%
Dec ‘13 -1.0%
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Negative ADR limiting RevPAR
-16%-12%-8%-4%0%4%8%
12%
2010 2011 2012 2013
RevPAR % Chg
12MMA May ‘11 10.9%
Dec ‘13 1.7%
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Occ growth; ADR declines across all classes
20 €
70 €
120 €
170 €
220 €
270 €
60%
62%
64%
66%
68%
70%
72%
Luxury Upper Upscale Upscale Upper Midscale Midscale Economy
Occ 13 ADR 13
+2.0%
+2.4%
+2.5% +1.5%
+4.1%
-1.6% -0.4%
-1.5%
0.0%
-1.9% -0.4%
+2.2%
Actual Occ & ADR & YOY % change
Occupancy ADR
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Southern Europe Signs of Recovery YE 2013
Western Europe
Occ 67% +1.1%
ADR € 108 +0.3%
RevPAR €72 +1.4%
Northern Europe
Occ 73% +3.4%
ADR € 96 -3.5%
RevPAR € 70 -0.2%
Southern Europe
Occ 64% +2.2%
ADR € 104 +2.2%
RevPAR € 66 +4.4%
Eastern Europe
Occ 61% +3.0%
ADR € 85 -4.0%
RevPAR € 52 -1.0%
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Source: Quartz.com, European Commission Predominantly domestic demand
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Limited Pipeline
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Pipeline growth consistent with LTA
6% 15%
23%
18%
6%
11%
21% LuxuryUpper UpscaleUpscaleUpper MidscaleMidscaleEconomyUnaffiliated
+143k rooms +3%
2014-2016
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UK, Russia, Germany have largest pipelines Top 10 by rooms
38%
21%
11% 10% 4%
4% 4%
3%
3%
2%
12%
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Outlook
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Demand & GDP in step, GDP forecast more positive (GDP Source: Oxford Economics)
-15%
-10%
-5%
0%
5%
10%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014f 2015f
Demand GDP
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2013 Actual Markets telling an Occupancy Story
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2014 Forecast: Time for rate growth Feb 2014 edition – local currency
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Summary
• Demand: Remains strong – increasing international
arrivals; EU economic improvements
• ADR: No real rate recovery, opportunities exist
• Supply: Limited growth in most markets
• Forecast: ADR growth across most markets
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STR Global
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Elizabeth Winkle
+44 (0)207 922 1930 [email protected]
STR Global, Ltd is the exclusive owner of all rights in this presentation and its content. Reproduction of all or a portion of this presentation for any purpose without prior approval of STR Global is strictly prohibited. This presentation is based on information compiled by STR Global Ltd. No strategic or marketing recommendations or advice are intended or implied.