Hogg Robinson Group booked more hotel room nights between
January and June 2015 than during the same period last year, according to the
travel management company’s 2015 interim hotel survey, released Thursday.
Calling the survey a “barometer for economic growth,” HRG
director of global hotel relations Margaret Bowler said the increase in room
nights indicates more corporates are traveling for business.
In local currency terms, HRG clients paid higher average
daily rates year over year in 26 of the top 50 cities. HRG’s largest ADR
increases in local currency were in Moscow (59.7 percent); Sydney (15.2 percent);
Tokyo (14.6); Chennai, India (14.3); and Sao Paulo (14.1 percent). Moscow remained the most expensive city for business travel for the 12th straight
year.
As in the last survey.
ADR in megacities often exceeded ADR in their respective regions. Similarly,
HRG noted that rates varied widely within each of several key markets. “Markets
globally are becoming even more fragmented and accommodating not only the
ongoing stature of the megacity in the face of the diminishing importance of
the region but also different city trends within the same city,” Bowler said. She
cited New York City, where new supply in the Times Square area weighed down
rate growth compared with other parts of the city.
Convention business boosted ADR in Chicago (17.9 percent to
$223.46) and Boston (7.2 percent to $297.60), while slow supply growth
bolstered rates in San Francisco (6.7 percent to $317.04) and Vancouver (11
percent). ADR in Washington, D.C., fell 10.3 percent to $298.31 as convention
business decreased from 2014 levels. In Houston, hit hard by the oil industry downturn,
ADR continued to drop, dipping 6.7 percent to $238.06.
Nine of the top 12 markets in Europe saw ADR rise in local
currency terms. An increase of fairs and conventions fueled rate growth in
Frankfurt (10.3 percent) and Berlin (6.9 percent), while a softer convention
season and an increase in supply lowered ADR in Paris by 4.3 percent. ADR
increased in seven of the top 10 U.K. markets, including Manchester, where it
rose 7.6 percent in the face of increasing corporate demand and low supply
growth. Aberdeen, like Houston, has hit a low-demand, high-supply slump as a
result of poor oil industry performance, as rate dropped 14.4 percent.
In the Asia/Pacific region, the largest ADR increases were
in leisure-focused Sydney (15.2 percent) and corporate-driven Tokyo (14.6
percent), which also benefited from exchange rates. Rate drops in Bangalore
(5.7 percent), Beijing (6 percent) and Shanghai (0.9 percent) were driven
almost entirely by shifts in exchange rate.
In the Middle East and West Africa, only Cairo (27.5
percent) and Doha, Qatar (2.3 percent), experienced increases in ADR; Cairo benefited
from a more stable political climate and increase in business demand.
Oversupply has led to an 8.2 percent drop in rates in Abu Dhabi.
Bowler advised flexibility for hotel programs in the year
ahead. “Not only in terms of being able to benefit from in-city fragmentation …
but also in terms of the increase in new bed stock in defined tiers,” she said.
“With new brands and concepts appearing almost daily, we are seeing many legacy
hotel chains fighting for the traditional midmarket.”