Hotel performance data in the latest HotStats survey shows that for the month of April, both Düsseldorf and Frankfurt registered double digit declines in Rooms Revenue per Available Room (RevPAR).
This led to a massive drop in Gross Operating Profit per Available Room (GOPPAR) performance, with Düsseldorf in April 2011 down to a third of what it was in April 2010.
“The headline numbers look particularly grim for the German cities but this reflects their weak leisure business. The rolling 12 month numbers actually show double digit increases in profit with the drop in April down to the move of Easter,” said Jonathan Langston, managing director, TRI Hospitality Consulting.
Düsseldorf and Frankfurt hotels registered respective declines in RevPAR of 30.1% and 23.4%, as the value and volume of commercial demand decreased significantly. As a result, Total Revenue per Available Room (TrevPAR) declined in both markets by 23.9% and 18.6%, resulting in a GOPPAR decline of 69.5% in Düsseldorf, and 45.4% in Frankfurt.
In addition to the Easter holiday period, both cities lacked the huge volume of demand created through significant biennial events. In Düsseldorf the Wire and Tube festival was badly missed, with branded upmarket hotels charging rooms in excess of €300 over a six-day period in April 2010.
In Frankfurt, the absence of the Light and Building exhibition was the significant cause of RevPAR decline. In addition, many guests to the 2010 exhibition were stranded due to the Icelandic ash cloud, which enabled hoteliers to capitalise on the surge of demand caused by the freak event.
“German cities with greater leisure appeal such as Berlin and Hamburg continued to enhance revenue and profit performance in April, and in all likelihood April 2011 performance is not reflective of the year-round trend of all German city markets, including Düsseldorf and Frankfurt, which is indicating sustained profit growth,” said Langston.