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Results
Global
Hotel Market
Sentiment Survey
July 2009
“Germany clearly shows a more optimistic mind-set than
the rest of the European market.
A positive sign in midst of a crisis!”
GLOBAL
HOTEL MARKET SENTIMENT SURVEY
July 2009
SHARE OF RESPONDENTS
INTRODUCTION
BY REGION
The Horwath HTL Global Hotel Market Sentiment Survey has been
40%
8% designed to provide the global hotel industry a quick assessment of
the future market outlook. The survey focuses on the outlook for
occupancy, average room rates and total revenue.
27%
11%
In this mid year survey, hoteliers have also been asked to make
8% 6%
Asia
Australia Pacific
comments on their expectations for the coming semester in
Europe
Americas comparison to the second half of last year, as well as comment on
South America
Africa
the impact the crisis has had on room night demand.
This report summarizes the outcome of the survey, gathered from
Content responses across 47 countries. Of the 2,593 respondents, 40 percent
Introduction page 1
of them came from Europe followed by Asia (27 percent), North
Summary page 2
st America (11 percent), South America and Africa shared 8 percent of
1 Half Market Performance
page 4
responses, and Australia Pacific (6 percent).
The Impact of the Financial
Crisis page 5
2nd Half Market Outlook At the current point in time, with the financial crisis still affecting all
page 6
corners of the world, it is not surprising to find most markets across
Hotel Performance
Expectations page 7 the world having the same negative assessment of the outlook for
2009. However, we hope that the following analysis provides some
Conclusion page 8
useful insight as to the expectations for different hotel markets
across the world.
Contact
This being the second survey this year by Horwath HTL, we have
Horwath HTL been able to analyze previous sentiment scores in order to give a
Kaiserstrasse 47
more in depth analysis.
60329 Frankfurt
Tel: +49 69 2400 9844
Email: office@horwathhtl.de
GLOBAL HOTEL MARKET SENTIMENT SURVEY | JULY 2009 | PAGE 2
SUMMARY
SENTIMENT RANKINGS
As a way to measure and compare the results across regions and
countries, we have created an index to formulate an overall average
By Region Score
sentiment score from all survey questions. The index utilized a scale
July 09 Feb 09
of -150 to 150 whereby a score of -150 denotes a sentiment of
1. South America 3 9.7
absolute pessimism and a 150 signifies a very optimistic outlook.
2. Africa -22 -20.7
3. Asia -41 -41.2 The German market denotes an overall sentiment score of -41 and
4. North America -46 -41.0 thus has the fifth most positive attitude towards the current eco-
5 Australia Pacific -48 -34.1 nomic situation out of the 23 European countries participating in the
6. Europe -55 -36.0 survey. On a worldwide scale German hoteliers position themselves
in the first “positive” third. Comparing continents Europe scores -55
points and samples the most negative score out of all continents and
ACTUAL PERFORMANCE ON GERMAN
MARKET COMPARED TO a drop of 20 points compared to the survey from February 2009.
EXPECTATIONS
100%
90%
80%
Regarding their performance of the first half of 2009 the survey
70% registers 42 % of the German hoteliers who indicate that it was the
60%
50% same or better as expected. This represents a positive outcome as
40%
only some 34 % of hotels worldwide performed equally or better as
30%
20% anticipated. Also Europe as a continent outranks Australia/ Pacific,
10%
0%
Asia and North America positioning itself third with a sentiment
Occupancy ADR Revenue
score of -46 points.
Much Better
Better
Same The impact of the crisis is considered stronger as predicted by 48 %
Worse
Much Worse
of the German participants. This is once again better than the overall
global judgment. Europe came into fourth place with a sentiment
IMPACT OF CRISIS AS EXPECTED?
score of -29 points. Worldwide a total of 51 % of the participants of
8% 10%
the survey stated that the crises’ impact on the hotel performance
31%
was more or much more as expected.
38%
19%
Much More
More
Same
Less
Much Less
www.HorwathHTL.com
GLOBAL HOTEL MARKET SENTIMENT SURVEY | JULY 2009 | PAGE 3
The third question dealt with the outlook for the second half of the
year 2009 compared to the second half of 2008. On a global scale
EXPECTATIONS FOR 2ND HALF OF 64 % of the hoteliers believe that their revenues will decrease by the
2009 COMPARED TO SECOND HALF
OF 2008 end of this year. With an average sentiment score of -49 points
Europe occupies the last place out of all the continents. Germany
100%
90% clearly contradicts the European trend with an average score of -34
80%
points and thus has more positive expectations than hotels in Asia
70%
60%
which came into third place. Yet all are expecting a negative
50% development of the ADR, occupancy rate and revenue.
40%
30%
20% In the last question of the survey partakers were asked to indicate
10%
0%
their expectations to the performance development for the second
Occupancy ADR Revenue
half of 2009 compared to the second half of 2008. With an average
Much Better score of -61 points Europe got once again into last place far behind
Better
Same
the fifth ranked – North America – achieving an average score of -49.
Worse German hoteliers again clearly draw a line between them and the
Much Worse
rest of Europe with an average sentiment score of -48 points
positioning themselves between the hoteliers of Asia (3rd rank) and
Australia/ Pacific (4th rank).
EXPECTATIONS FOR 2ND HALF OF
Germany cannot denote a positive sentiment score once, however,
2009 COMPARED TO SECOND HALF
OF 2008 clearly shows a more optimistic mind-set than the rest of the
European market. A positive sign in midst of a crisis!
100%
90%
80%
If you are interested in further insights of the global outcome of the
70%
60%
survey please continue reading on page 4. For more information
50% about the survey and Horwath HTL please do not hesitate to contact
40%
30%
us at:
20%
10%
0%
Horwath HTL
Occupancy ADR Revenue
Kaiserstrasse 47
-15%+ -15% to -10% 60329 Frankfurt am Main – Germany
-10% to -5% -5% to 0%
0% 0% to 5%
5% to 10% 10% to 15%
Tel: +49 69 24009844 ▪ Fax: +49 69 6313332 ▪ www.horwathhtl.de
15%+
or send us an email at: office@horwathhtl.de.
www.HorwathHTL.com
GLOBAL HOTEL MARKET SENTIMENT SURVEY | JULY 2009 | PAGE 4
RATIO OF RESPONSES FIRST HALF MARKET PERFORMANCE
100%
90%
80%
The first survey question dealt with the contributors’ actual
70% performance in the first half of the year compared to their
60%
expectations at the beginning of the year.
50%
40%
30% In response to expectations on market-wide occupancy performance,
20%
10%
66 percent of hoteliers replied that performance in the first half of
0% the year was worse or much worse than what had been expected, 17
Occupancy ADR Revenue
percent replied that occupancy performance was the same, while just
Much Better 18 percent replied better or much better. This shows the full effect
Better
Same
the crisis had on demand in an industry which was already expecting
Worse a harsh impact; 64 percent of hoteliers expected a decrease in
Much Worse
occupancy in our February survey.
Respondents showed that ADR suffered the least of all our
“66 percent of hoteliers performance gauges, with 41 percent of hoteliers replying that ADR
replied that performance has been the same, or better than was expected. 59
performance in the first percent of hoteliers still voiced that ADR performed worse or much
half of the year was worse.
worse or much worse
than what had been Revenue followed a similar trend, wherein the majority, 72 percent,
of hoteliers revealed that revenue was worse or much worse than
expected.”
expected.”
what had been expected at the beginning of the year. Only 14
percent of respondents found performance to be similar to what was
expected, and 14 percent saw a positive performance with regards to
MARKET PERFORMANCE their expectation.
RANKING
Occ, ADR Rev. Avg South America again showed the least pessimistic assessment of the
1. South first half performance, although still scoring a negative 19 average.
-40 10 -28 -19
America
North America showed that it was been affected harshly, taking 6th
2. Africa -59 -17 -40 -39
position, and an average sentiment score of negative 61. Asia
3. Europe -45 -38 -55 -46
followed suit closely, scoring negative 56. Asia, which relies heavily on
4.Australia
Pacific
-29 -59 -56 -48 international trade, has suffered in hotel performance.
www.HorwathHTL.com
GLOBAL HOTEL MARKET SENTIMENT SURVEY | JULY 2009 | PAGE 5
THE IMPACT OF THE FINANCIAL CRISIS
RATIO OF RESPONSES
The second question asked respondents if the currents crisis has
impacted demand to the extent which was expected.
3% 12%
21%
When hoteliers were asked if the crisis had impacted their demand
as expected, 51 percent responded that demand had been affected
more or much more than expected. A quarter, 25 percent, replied
39%
25%
that demand had been affected the same amount as had been
Much More expected. And 24 percent of respondents proclaimed that the crisis
More has impacted demand less or much less than had been expected.
Same
Less
Much Less Looking at the hotel performance ranking by region, it can be noted
that no region has scored a positive sentiment score. The region with
the least pessimistic view yet again lies with the south Americans,
although this is a severe relegation from their sentiment score of 49,7
in the February survey. South America is followed by Asia with a
“No region has scored a
score of -18, Australia Pacific (-24), Europe (-29), Africa (-36), and
positive sentiment
North America (-41).
score.
score.”
North America again scored the lowest sentiment score in
comparison to the other regions of the world. As a supporting nation
for many regions, this gives a bleak outlook for the coming year.
IMPACT OF FINANCIAL CRISIS
1. South
-17
America
2. Asia -18
3. Australia
-24
Pacific
4. Europe -29
5. Africa -36
6. North
-41
America
www.HorwathHTL.com
GLOBAL HOTEL MARKET SENTIMENT SURVEY | JULY 2009 | PAGE 6
RATIO OF RESPONSES SECOND HALF MARKET OUTLOOK
100%
90%
Hoteliers were asked their expectation for the second half of the
80%
70% year compared to the second half of last year, in relation to hotel
60%
occupancy, average room rate and hotel revenues.
50%
40%
30%
Over 50 percent of respondents stated that they expected all
20%
10% performance measures to perform worse or much worse in the
0%
second half of the year in comparison to the second half of last year.
Occupancy ADR Revenue
Much Better
Better
Occupancy scored a global average sentiment score of negative 36
Same wherein 58 percent of respondents expect declining growth in
Worse
Much Worse occupancy levels vis a vis the second half of 2008. South America
recorded the highest sentiment score (-6), followed by Asia (-29),
“64 percent of hoteliers Australia/Pacific (-31), Africa (-33) North America (-39), and Europe
around the Globe being the most pessimistic with a score of negative 46.
expect lower revenues
expect lower revenues
in the second half 2009 The global average sentiment with regard to ADR expectations
compared with second scored negative 39. The only region to record a positive sentiment
2008.”
half 2008.” score for ADR growth was South America, with all other regions
scoring negatively, Africa (-4), Asia (-41), North America (-42),
EXPECTATION FOR THE SECOND Europe (-45), and the lowest sentiment score came from Australia
HALF OF THE YEAR
Pacific (-57).
Avg Occ ADR Rev
1. South
8 -6 20 8 Revenues recoded the lowest sentiment score of all the performance
America
2. Africa -19 -33 -4 -20 gauges, recording a global score of negative 43, with 64 percent of
hoteliers around the globe expecting lower revenues in the second
3. Asia -36 -29 -41 -40
half 2009 compared with the second half of 2008. Again the region
4. North
-43 -39 -42 -47
America with the highest sentiment score was South America, recording a
5. Australia score of 8, followed by Africa (-20), Asia (-40), North America (-47),
-47 -31 -57 -52
Pacific
Australia Pacific (-52), and Europe holding the most pessimistic score
6. Europe -49 -46 -45 -55
of negative 55.
www.HorwathHTL.com
GLOBAL HOTEL MARKET SENTIMENT SURVEY | JULY 2009 | PAGE 7
RATIO OF RESPONSES
100% HOTEL PERFORMANCE EXPECTATION
90%
80% The last survey question asked was for hoteliers to give their
70%
expectation of how their respective hotels will fare in the second half
60%
50% of 2009 with respect to the second half of 2008, in percentage terms.
40%
30%
20% The global sentiment outlook was yet again rather bleak from
10%
hoteliers, with a global sentiment average score of negative 49. Over
0%
Occupancy ADR Revenue 60 percent of hoteliers expect to see a drop in performance growth
-15%+ -15% to -10% of at least 5 percent, and on average 15 percent of hoteliers around
-10% to -5% -5% to 0%
the globe expect to see hotel performance contract by 15 percent or
0% 0% to 5%
5% to 10% 10% to 15% more.
15%+
68 percent of hoteliers expect occupancy to decrease by at least 5
60
“Over 60 percent of percent in the second half, and a global sentiment of negative 47 was
hoteliers expect to see a scored. The most opportunistic region was South America, scoring
drop in performance negative -17, Asian and Australian/Pacific hoteliers grasped a more
growth of at least 5 pessimistic approach with the same score of negative 38, followed by
percent”
percent” Africa (-41), North America (-49), and Europe (-61) followed suit.
SECOND HALF HOTEL The global sentiment score for ADR was similar as for occupancy,
PERFORMANCE EXPECTATION
scoring negative 44, with 63 percent of hoteliers around the world
Avg Occ ADR Rev
expecting performance to diminish by at least 5 percent. South
1. South
-1 -17 17 -3 America scoring a rare positive sentiment of 17, Africa scored
America
2. Africa -26 -41 -6 -30 negative 6, the rest of the world showed much lower sentiment
3. Asia -47 -38 -49 -52
expectations, Asia (-49), North America (-45), with Europe and
Australia Pacific scoring (-55).
4. Australia
-49 -38 -55 -55
Pacific
5. North The global sentiment regarding hotel revenues again scored the
-49 -49 -45 -54
America
lowest sentiment score of all the performance gauges, negative 54.
6. Europe -61 -61 -55 -67
Hoteliers were the most pessimistic, with over 70 percent of
respondent’s expecting revenues to falter by at least 5 percent in the
coming semester.
www.HorwathHTL.com
GLOBAL HOTEL MARKET SENTIMENT SURVEY | JULY 2009 | PAGE 8
CONCLUSIONS
Hoteliers in all regions with the exception of South America generally expect the year to remain tough, with
respect to market-wide and individual property performance. The majority of the contributors projected that
performance in all three measures, room occupancy, average room rates and total revenue, will likely decline in
the second half of the year. However, hoteliers in Indonesia and Brazil on average had a more positive outlook
than most other countries across the globe; South America as a region recording the most positive sentiment
scores and actually anticipated slight increased in performance in the second semester of 2009.
The impact of the current financial crisis is seen to have affected all corners of the world, although the North
American region shows that the current difficulties in the hotel industry is directly induced to the crisis, while
regions such as Asia and Australia had more hoteliers that felt the global financial crisis had impacted the
market less than expected. Europe has scored the lowest sentiment score in expectation to see continued
strong declines in performance in the second half of the year.
Other Market Sentiment Reports
BY REGION
ASEAN Benelux Europe Northeast Asia South East Europe
BY COUNTRY
Australia Austria Belgium Bulgaria Canada China
Croatia Czech Republic France Germany Hungary India
Indonesia Italy Japan Macedonia Montenegro Mexico
Netherlands Norway Romania Serbia South Africa Spain
BY CITY/ DESTINATION
Beijing Hong Kong Shanghai Shenzhen
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