Signs of green shoots for hotel sector in Spain

According to the latest report from the Confederation of Hotels and Tourist Accommodation in Spain (CEHAT), in the month of February there was a rise in overnight stays of 5.4 percent across the hotels in Spain when compared to the same month in 2010. On the other hand the performance data show that there were not many hotels in Spain which improved their results in relation to income, the only exception being the hotels in Seville.

Four and five star hotels in Seville increased their occupation levels by some 9.1 percent in February, while RevPAR (revenue per available room) rose by a very healthy 26.9 percent. The RevPAR  indicator is a very important ratio used in the hospitality industry in order to gauge the financial performance of a hotel and it is used to measure the approximate average revenue per day achieved from each of its hotel rooms over a given period. According to the study from CEHAT, the RevPAR of four and five star hotels in Seville came to €43.05 during February. The hotels in Seville were the only ones that showed an improvement across the board in the comparison of four of the main cities in Spain. Along with Seville, only the five star hotels in Barcelona managed to increase their RevPAR by around 5.5 percent in February reaching €103.85. RevPAR fell in most of the rest of the hotels in Spain examined in the CEHAT report. For example, four star hotels in Barcelona were down by 4.6 percent and four star hotels in Madrid were down 6.2 percent. RevPAR among five star hotels in Madrid was down 2.8 percent and some 8.2 percent among the hotels in Valencia.

These figures indicate that, despite the increasing number of bookings among the hotels in Spain, there is still work to be done before the hotels can improve profitability. The policy of reducing hotel rates to attract customers has seriously eroded profit margins in some parts of Spain and in many cases has even caused hotels to post losses.


This entry is filed under Seville Hotels.