With only 12 months to go until London welcomes athletes and visitors from around the world to the 2012 Olympics, hoteliers in the UK capital have begun warming up for the main event with a room occupancy of 92.1%.

The staggering room occupancy this month followed a room occupancy of 91.9% during the same period in 2010 and fuels anticipation for hoteliers at the prospect of what the shape of demand may be during the same period in 2012 when it is estimated that 380,000 international visitors will require hotel accommodation in or around the UK capital during the event.

The volume of demand in London also allowed hoteliers to leverage room rate to achieve a 4.5% year-on-year increase to €204.12, contributing to a 4.8% increase in Revenue per Available Room (RevPAR) to €188.07.

Whilst the strength of demand for hotel accommodation in London may be attributed to the timing of Ramadan this year, which has meant that Middle Eastern visitors who typically come to London during the summer in search of a more temperate climate have primarily travelled during July, industry commentators have also suggested that there may a higher volume of Middle Eastern visitors than usual due to political uncertainty in the Arab world as well as demand displaced from Paris due to the banning of the burka in France.

That said, hoteliers in Paris are unlikely to be concerned with the reduction in the number of Middle Eastern visitors to the French capital as they recorded a RevPAR increase of 11.1% in July, on the back of a 9.5% increase in average room rate to €211.13.

In addition to the regular spectacle associated with the arrival of the Tour de France in the capital at this time of year, Hotels in London achieve a stunning room occupancy of 92.1% in July the 9th edition of the Paris Film Festival helped hoteliers to achieve a 14.5% increase in profit per room to €92.23.

"Their status amongst the most popular visitor destinations in the world means hotels in London and Paris are wellpositioned to achieve strong headline performance levels during the summer period. When these periods of trading are positively impacted by events such as the timing of Ramadan it is not unusual for occupancies to be in excess of 85%, but at more than 90% hoteliers in London are setting the bar extremely high for themselves," said Jonathan Langston, managing director, TRI Hospitality Consulting.

Vienna and Brussels struggle without primary sources of demand

Both Vienna and Brussels suffered significant year-on-year declines in profit per room in July and whilst the decline signalled a return to business as usual for the Austrian capital following a major event this time last year, the Belgian
capital suffered its typical summer decline as European Parliament was in recess, according to the latest HotStats survey.

For hoteliers in Vienna it was back to reality this month after the high watermark achieved in the city in July 2010. Demand for accommodation soared in the Austrian capital this time last year as it was fuelled by attendees to the extremely high-profile International Aids Conference, which attracted nearly 20,000 attendees over a six-day period.

However, in the absence of this event, room occupancy levels in Vienna dropped by 12.8 percentage points in July to 74%, which, alongside a 14% decline in average room rate, led to a 26.7% decline in RevPAR to €91.27.

In addition to the decline in volume, hotels in Vienna suffered the loss of ancillary expenditure in food and beverage outlets and meeting rooms, exemplified by a 9.7% decrease in food and beverage revenue per available. Furthermore, the achieved average rate in the conference sector dropped by 24.6% to €116.32 as the market lamented the absence of various syndicate and breakout meetings which filled hotel meeting space during the 2010 conference.

"Whilst Vienna's statistics for the month would typically send alarm bells ringing, the declines across all headline performance measures are not unexpected and have simply returned hotels in the Austrian capital closer to the year-to-date performance," said Langston.

Despite the 51.4% decline in Gross Operating Profit per Available Room (GOPPAR), profitability conversion in Vienna remained at 24.4% of total revenue, compared to a year-todate average of 24.9%, reflecting the return to the status quo.

Meanwhile, hoteliers in Brussels are not lamenting the absence of a major event in July but the lack of demand which is typically created by visitors to, and MEPs attending, European Parliament. When parliament is in session hotels in Brussels have recorded room occupancies in excess of 70% at achieved room rates of close to €150.

However, whilst European Parliament is in recess, as in July, average room occupancy can drop to as low as 64.7% at an achieved room rate of just €104.49.

As a result of the drop in rooms revenue, as well as declines in food and beverage revenue (-15%) and meeting room revenue per available room (-22%) profit per room in Brussels fell to just €6.28 per available room equivalent to a profitability conversion rate of just 7% of total revenue.