There is no doubt that the COVID-19 pandemic has had a most dramatic effect on the hotel business throughout Europe and words like ‘unprecedented’ and ‘unique’ are used liberally to describe the situation. Performance data from STR for the first half of the year compared with 2019 show how dramatic the effect on the hotel sector has been with RevPAR since March 2020 nose-diving, with many hotels closing their doors.
Reflecting back on previous downturns in the last 20 years enables us to recognise that the sharp declines in RevPAR in the period post-9/11 and following the Global Financial Crisis of 2008-09 were followed by a period of recovery, resulting in an overall cycle of some six years in each case. The various terrorist-related atrocities in 2016 in many European cities had a much less devastating impact on hotel performance.
We are therefore encouraged by this resilience and envisage that, notwithstanding the exceptional decline in business during Q2 of 2020, the hotel sector within Europe should have re-established its RevPAR 2019 performance by 2024.