Seven of the 10 European cities in this month's survey registered a Gross Operating Profit per Available Room (GOPPAR) decline in January 2012.

The well documented socio-economic troubles in Greece, with mass demonstrations and riots concentrated in Athens, significantly impacted hotel trading performance. In January, Revenue per Available Room (RevPAR) and Total Revenue per Available Room (TrevPAR) declined by 15.3% and 19.7% respectively, as GOPPAR declined by 119.3% to -€21.25.

"The scale and impact of the riots coupled with proposed austerity measures is likely to continue to adversely impact hotel trading performance in the Greek capital for some time. From a market perspective, it is unlikely that we will see any pick-up in business or leisure-related tourism to Athens anytime soon, particularly in light of the recent news (in February) that many landmark historic buildings in Athens were vandalised and destroyed," said Jonathan Langston, managing director, TRI Hospitality Consulting.

Barcelona and Istanbul also registered significant decline in GOPPAR performance (-36.6% and -29.6%, respectively). Interestingly, RevPAR performance in Istanbul increased by 3.7%, whilst the decline in Barcelona's RevPAR performance was marginal (-1.6%). However, TrevPAR performance in both cities declined significantly (-4.1% and -5.9% respectively).

Furthermore, GOPPAR performance also declined in Paris (-3.6%), Milan (-5.6%) and Amsterdam (-1.8%) despite  registering positive RevPAR growth.

January is typically a challenging month when demand levels are particularly low and price-sensitive. That said, eight of the 10 cities surveyed registered RevPAR growth, which from a top-level view may appear encouraging. General decline in Gross Operating Profit Performance across Europe in January However, it is clear that the travellers are restricting spend which in turn results in lower TrevPAR performance. In this instance, half of the 10 cities surveyed registering a decline in
TrevPAR performance.

"The market conditions for hoteliers remain challenging. Non-rooms revenue performance has acted as a brake on overall revenue growth and consequently overall profitability has suffered. This underlines how vital it is that the industry looks beyond rooms revenue as its pulse check," commented Langston.

Moscow and London are Star Performers

Moscow and London registered robust RevPAR, TrevPAR and GOPPAR results for the month of January according to the latest HotStats survey.

The Russian capital experienced a 9.8 percentage point increase in occupancy performance and 4.5% growth in average room rate performance to register RevPAR growth of 27.4%.

Closer examination of market sector performance indicates that the surge in January RevPAR was due to a significant increase in the volume and value of conference demand, as the volume of roomnight demand from this sector more than doubled, and achieved conference sector rates rose by almost 40 per cent. As a result, TrevPAR increased by 22.6 per cent and GOPPAR by 68.7 per cent.

London also experienced relatively robust growth, as RevPAR (+8.2%), TrevPAR (+5.8%) and GOPPAR (+7.5%) performance all increased in the month of January. In contrast to Moscow hotel market performance, the increase in London RevPAR performance was underpinned by a uplifts in the volume and value of leisure-related demand.

Zurich also experienced an increase in GOPPAR performance (2.6%), as well as the strongest occupancy performance of all cities surveyed (73.7%).

"January is always a difficult month to gauge any  trends in European market performance. Given the fact that cities such as London, Paris and Amsterdam experienced relatively strong rates of GOPPAR growth in 2011 (on 2010 performance), it will be interesting to see how 2012 trading performance will play out," said Langston.