Five of the ten European cities for which we present data this month registered Gross Operating Profit per Available Room (GOPPAR) growth in December.

Berlin, Prague, Warsaw and Paris experienced double digit growth in December, with Berlin registering the highest level of GOPPAR growth (+24.5%). The German capital posted a 6.9 percentage point growth in occupancy performance (68%) which compensated for a 2.6% decline in average room rate performance, resulting in an 8.3% Revenue per Available Room (RevPAR) growth to €84.40. In contrast, Frankfurt hotels experienced an 8.6 percentage point reduction in occupancy (47.6%) resulting in a RevPAR and GOPPAR decline of 10% and 49.5%, respectively.

Of the top three hotel markets of London, Amsterdam and Paris, the French capital led the field with a 5.2% growth in Total Revenue per Available Room (TrevPAR) performance and 14.2% GOPPAR growth.

Amsterdam also experienced a rise in TrevPAR performance (+1.2%), although rising operating costs resulted in a reduction in GOPPAR (-3.9%) to €39.93.

London registered a slight decline in TrevPAR performance (-1.1%), resulting in a 5.8% decline in GOPPAR to €91.86.Despite a relatively weak room occupancy performance in the Hungarian capital, at just 65.5%, an increase in demand from the conference sector helped to boost the achieved average room rate for hoteliers in Budapest to €91.89 from €84.77 during the same period in 2010.

Mixed Profit Results Registered for the month of December Prague achieved 15.5% RevPAR growth as both occupancy (+7.5 percentage points) and average room rate (+2.1 per cent) increased, resulting in GOPPAR growth of 15.9% to €26.13.

"This time last year, the Prague market experienced an influx of new hotels which, combined with turbulent market conditions, resulted in 2010 revenue and profit performance being severely impacted. In 2011, the Czech capital has experienced 5.2% in RevPAR performance and 13.7% increase in GOPPAR performance.

Whilst the market is still performing significantly below 2008 levels, there appears to be evidence that the Prague hotel market has bottomed out and is beginning the process of recovery", said Jonathan Langston, managing director, TRI Hospitality Consulting.

In 2011, London, Paris and Amsterdam registered GOPPAR performance surpassing previous peak 2008 performance levels according to the latest Hot- Stats survey.

Eight of the ten cities surveyed experienced an increase in 2011 GOPPAR performance when compared to 2010, the exceptions being Madrid (-2.6%) and Rome (-11.3%).

For 2011, the hotel markets of Amsterdam, Warsaw, Prague and Paris all experienced double digit growth in GOPPAR performance, with Paris registering the greatest growth in RevPAR (+12.1%), TrevPAR (+9.2%) and GOPPAR (+15.8%) .

"Overall, the fact that revenue and profit performance for most of Europe's major cities has grown in 2011 is positive when considering what has happened to the European economy since 2009. For the majority of these markets, the primary factor for an uplift in RevPAR performance in 2011 has been the relative increase in the volume and value of corporate travel", said Langston.

Of the ten cities surveyed this month, 2011 GOPPAR performance of Amsterdam, London, Paris, Frankfurt, Berlin and Warsaw surpassed previous peak 2008 GOPPAR performance.

TrevPAR and GOPPAR Recovery in 2011
Stronger European Economies Surpass 2008 Revenue and Profit Performance

"In 2011 major cities in European nation economies which have shown greater resilience since the economic downturn in 2008 such as UK, France, Germany and Poland achieved revenue and profit performance exceeding pre-recession performance. In 2012 it will be interesting to see how continental and global market conditions will affect various European hotel city markets. Many will monitor whether more established and mature markets such as Paris, Amsterdam and London will be able to continue to achieve sustained revenue and profit growth whilst on the other end of the scale, observe whether other major European city markets which have begun the process of revenue and profit recovery can continue
the trend", reflected Langston.