Hotels in European destinations benefited this summer from more American tourists. The standout was Italy, where higher average daily rates drove revenue, particularly at the country’s luxury hotels.
In an analysis for STR’s Data Insights blog, Manager of Data Operations Cameron Spence wrote that monthly hotel occupancy across Europe — France, Greece, Italy, Portugal and Spain — ranged from 73% to 80% in June and July.
Where Italy’s hotels stand apart, however, is in top-line revenue metrics. Average daily rates in Italy for the month of June and July were roughly €100 ($107.24) higher than those achieved by Spain’s hotels, for example.
Higher rates boosted revenue per available room across Italy’s hotels to €213.80 in June and €202.86 in July. Greece’s hotels fell closely behind for June, but were at a nearly €40 premium for July.
The achievement in rate was even more pronounced at the luxury-class level, where revenue managers “were able to command ADRs of €978.65 in June and €1,031.85 in July, representing respective uplifts of 26.6% and 22.8% from the previous year,” Spence wrote.
“Much of that gain can be associated with the return of travelers from the United States, one of the biggest spending groups on European luxury travel.”
However, even Italy’s economy-class hotels achieved higher ADRs than those in key destinations across Europe.
“This means that as rates have risen across all property types, more budget-conscious guests have turned toward more affordable accommodation. In turn, properties lower on the chain scale have pushed rates thanks to higher demand,” Spence wrote.
Data from STR, CoStar’s hospitality analytics firm, also reveals that summer hotel bookings in Italy picked up at the start of 2023. At the end of 2022, occupancy exceeded 20% only for a few key dates across five key Italian markets. But by February, Florence had 44% occupancy on the books, for example.
For more, check out STR's Data Insights blog.