A HotelBenchmark Survey and assessment of European hotel performance trends Launch of the HotelBenchmark Survey for Belgium and The Netherlands Julia Felton Executive Director HotelBenchmark
HotelBenchmark Survey enables Hotels to share information and make actionable decisions without risk of competition law litigation. Industry watchers to learn of the latest hotel performance around the world (except North America). Individual hotels and brands to benchmark performance and thus make actionable decisions on sales, marketing and revenue management issues. Benefits include: Independent assessment of market conditions Rapid results - 15 days after month end Data available 24x7 via www.hotelbenchmark.com Historical data available back to 1996 Avoid liability under competition law Confidentiality of data guaranteed 1
Our reporting is the most extensive Twelve unique monthly surveys tracking hotel performance: Four regional surveys Eight in-depth country/city reports Asia Pacific Europe Middle East & Africa Caribbean & Latin America Australia Belgium & The Netherlands Germany Italy New Zealand South Africa United Kingdom London 2
Its not just limited to revpar Annually we track the profitability of 2,000 hotels globally Monthly we track the profitability of 300 hotels in Germany and 25 hotels in London 3
Belgium and The Netherlands Survey Collects occupancy, average room rate and revpar from some 26,000 rooms across the region Key Statistics: 70% of rooms located in The Netherlands of these 40% are located in Amsterdam Split by region: northwest (55%); central (10%); south west (20%); south east (15%) Key cities monitored: Amsterdam, Schiphol, The Hague, Rotterdam 8,500 rooms in Belgium of which 55% located in Brussels Key cities monitored: Antwerp, Brussels, Zaventem 4
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A European hotel performance trends
The big picture economy & politics Global geo-political uncertainty continues Middle East Palestine (intifada), Iraq (threat of war) Central Asia Afghanistan, Chechnya Indian sub-continent Kashmir South-East Asia Indonesia, Philippines, Malaysia, Thailand US foreign policy more aggressive stance is unnerving many Northern Ireland government suspended 9
The big picture the economy The three engines of global growth are spluttering lack of reform/debt re-structuring in Japan Germany mired in recession unemployment at record highs US growth prospects unclear Financial distress in Latin America Brazil, Argentina Financial scandals Enron, WorldCom, Tyco, Equitable Life Unnerving investors Risk of conflict in Iraq oil price fluctuating accordingly possible impact on investment decisions 10
The big picture social landscape Fear of travel receding as time passes? perhaps less so for the US holidaymakers opting to stay closer to home Terrorism engenders fear Bali - Yemen Moscow - Mombassa Travel/booking patterns changing budget carriers lead the way Behavioural change wrought by economic uncertainty and personal safety concerns post-9/11 11
% Change in revpar (US$) 20% 10% 0% -10% -20% -30% -40% Europe US ME Asia Jan-00 Mar-00 May-00 Jul-00 Sep-00 Nov-00 Jan-01 Mar-01 May-01 Jul-01 Sep-01 Nov-01 Jan-02 Mar-02 May-02 Jul-02 Sep-02 12
RevPAR % change by major market area 25 20 15 10 5 0-5 -10 2000 2001 YTD 2002 Germany UK France Italy Spain Central Europe Benelux 13 Scandinavia
RevPAR performance - Europe (2000-02) 40 30 (% change) 20 10 0-10 -20 J M S J M S J M S 2000 2001 2002 Occupancy ADR 14
Where is Europe now? Sept YTD 2002 % change in revpar (Euros) (10%+) (5-10%) (0-5%) 0 0-5% +10% Frankfurt Brussels Amsterdam Athens Geneva London Copenhagen Barcelona Gothenburg Moscow Cyprus Berlin Lisbon Rome Budapest Salzburg Stockholm Dublin Helsinki Madrid Milan Paris Prague 15
Occupancy (2001 v 2002 YTD) Amsterdam London Paris Rome Madrid Brussels Berlin Frankfurt 0 10 20 30 40 50 60 70 80 YTD 2001 16
Average Room Rate (2001 v 2002 YTD) Paris Rome London Amsterdam Madrid Frankfurt Brussels Berlin 0 20 40 60 80 100 120 140 160 180 200 YTD 2001 17
RevPAR performance - Amsterdam (2000-02) 50 40 30 (% change) 20 10 0-10 -20 J M S J M S J M S 2000 2001 2002 Occupancy ADR 18
RevPAR performance - Brussels (2000-02) 40% 30% 20% (% change) 10% 0% -10% -20% -30% J M S J M S J M S 2000 2001 2002 Occ Rate 19
Relative performance 120 Netherlands Belgium Germany 100 80 60 40 20 0 2002YTD 2002 YTD 2002YTD Occ ADR revpar 20
Relative performance - % change Netherlands Belgium Germany 0-1 -2-3 -4-5 -6-7 -8-9 -10 2002YTD 2002 YTD 2002YTD Occ ADR revpar 21
Jan-01 Feb-01 Mar-01 Apr-01 May-01 Jun-01 Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 RevPAR Netherlands, Belgium, Germany 110 100 90 80 70 60 50 40 30 Netherlands Belgium Germany Jun-02 Jul-02 Aug-02 Sep-02 22
Jan-01 Feb-01 Mar-01 Apr-01 May-01 Jun-01 Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 City centre v provinces - % change in revpar 140 130 120 110 100 90 80 70 60 50 40 Amsterdam Netherlands Regions Aug-02 Sep-02 23
Jan-01 Feb-01 Mar-01 Apr-01 May-01 Jun-01 Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 City centre v provinces - % change in revpar 100 90 80 70 60 50 40 Brussels Belgium Regions Aug-02 Sep-02 24
City centre v provinces - % change in revpar 140 130 120 110 100 90 80 70 60 50 40 Amsterdam Netherlands Regions Brussels Belgium Regions Jan-01 Feb-01 Mar-01 Apr-01 May-01 Jun-01 Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 Aug-02 Sep-02 25
Netherlands - city performance 140 Amsterdam Amsterdam Schiphol The Hague Rotterdam 120 100 80 60 40 20 0 2002YTD 2002 YTD 2002YTD 2002YTD Occ ADR revpar 26
Netherlands - city performance - % change 10 8 6 4 2 0-2 -4-6 -8 Amsterdam Amsterdam Schiphol The Hague Rotterdam 2002YTD 2002 YTD 2002YTD 2002YTD Occ ADR revpar 27
Jan-01 Feb-01 Mar-01 Apr-01 May-01 Jun-01 Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 Aug-02 Sep-02 KLM RPK % Change v Schiphol RevPAR % Change 30% 20% 10% 0% -10% -20% -30% -40% Change in Schiphol RevPAR KLM change in RPK 28
Relative performance % change 2002 YTD Amsterdam (AAR <100 euros) Amsterdam (AAR 100-150 euros) Amsterdam (AAR >150 euros) -4-3 -2-1 0 1 2 3 Occ ADR revpar 29
Belgium - city performance 140 120 100 80 60 40 20 Brussels Brussels - Zaventem Antwerp 0 2002YTD 2002 YTD 2002YTD Occ ADR revpar 30
Belgium city performance - % change 5 0-5 -10-15 -20-25 -30-35 Brussels Brussels - Zaventem Antwerp 2002YTD 2002 YTD 2002YTD Occ ADR revpar 31
Jan-01 Feb-01 Mar-01 Apr-01 May-01 Jun-01 Jul-01 Aug-01 Sep-01 Oct-01 Nov-01 Dec-01 Jan-02 Feb-02 Mar-02 Passenger arrivals v Occupancy 20% 10% 0% -10% -20% -30% -40% -50% Passenger Arrivals Zaventem Apr-02 May-02 Jun-02 Jul-02 32
Relative performance % change 2002 YTD Brussels (AAR <100 euros) Brussels (AAR >100 euros) -10-5 0 5 10 Occ ADR revpar 33
And what has happened to profit? 40 Amsterdam Frankfurt London Paris Rome Brussels 30 % change GOP 20 10 0-10 -20 2000 2001 34
Who has been bearing up under the strain? The European budget sector has proved resilient 35
Rolling 12 occupancy by grade of hotel 72% 70% 68% 66% 64% 62% Luxury First Mid Economy Jan-00 Mar-00 May-00 Jul-00 Sep-00 Nov-00 Jan-01 Mar-01 May-01 Jul-01 Sep-01 Nov-01 Jan-02 Mar-02 May-02 Jul-02 Sep-02 36
Jan-00 Mar-00 May-00 Jul-00 Sep-00 Nov-00 Jan-01 Mar-01 May-01 Jul-01 Sep-01 Nov-01 Jan-02 Mar-02 RevPAR (US$) rolling 12-basis 78 73 68 63 58 53 48 43 Europe US ME Asia May-02 Jul-02 Sep-02 37
Jan-00 Mar-00 Rolling revpar by gateway city 160 140 120 100 80 60 Amsterdam Brussels London Frankfurt Paris Madrid Rome May-00 Jul-00 Sep-00 Nov-00 Jan-01 Mar-01 May-01 Jul-01 Sep-01 Nov-01 Jan-02 Mar-02 May-02 Jul-02 Sep-02 38
An uncertain outlook; but solid fundamentals Recovery may be slower than originally forecast but borrowing costs are at historic lows albeit lenders are cautious 2003: Netherlands GDP 1.6%; Belgium 1.3%; EU 2.3% Key gateway cities appear to have turned the corner but beware the false dawn Further volume-building in the short-term minimal (if any) growth in corporate rates tactical discounting across larger portfolios Change in travel patterns frequent shorter trips closer to home by 2007 Netherlands forecast to have 13 million international visitor arrivals 39
An uncertain outlook; but solid fundamentals Resorts likely to exhibit mixed performance dependent on health of major outbound markets personal safety is a critical issue Germany is critical to the health of most tour operators Transactions appear likely to continue more realistic expectations as to value We will continue to live with volatility but there are no distressed sellers and debt is available 40
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