Markets with RevPAR growth steadied, Italy lead continued into autumn

Analysis by Eddie Yeung

STR's global “bubble chart” update as of 21 October 2023 showed 89% of markets with growth in revenue per available room (RevPAR) compared to 2019. This percentage of recovered markets remained steady at above 80% worldwide, indicating a normalized performance across the globe.

Among countries with 50,000 rooms and sufficient hotel reporting levels, Italy and Singapore led in absolute RevPAR. Switzerland, South Korea and Ireland also saw strong absolute RevPAR although all three were US$30-plus below Italy and Singapore. Italy’s RevPAR continues to be driven by strong average daily rate (ADR), which is up 18% this year. Adjusting for inflation, Italy’s RevPAR was still 31% higher than what it was during the same period in 2019.

Six countries recorded an occupancy rate above 80%—Ireland, Italy, the United Kingdom, Belgium, Spain, and Portugal, which is one more than the previous update. Notably, each of these countries are in Europe, which has just entered the autumn season. It's worth highlighting that the Southern European countries (Spain, Italy, and Portugal) recorded even higher occupancy rates than the summer holiday.

The top five countries leading in RevPAR growth versus 2019, with a monthly room supply above 50,000 rooms, include Portugal, Italy, Colombia, the United Arab Emirates, and the Dominican Republic. A seasonal shift in leading performance is noticeable, with more countries outside of Europe entering the top spots. For the fifth consecutive 28-day period, Italy continued to lead in both absolute RevPAR and RevPAR growth compared to 2019. The country's RevPAR continues to be driven by strong average daily rate (ADR), which is up 18% this year. Adjusting for inflation, Italy’s RevPAR was still 31% higher than what it was during the same period in 2019.

Notably, Vietnam continues to be an outlier in terms of recovery, with its RevPAR remaining 23% behind 2019 levels.

Continuing the trend of occupancy lagging 2019 levels, only 13 of 48 countries recorded occupancy growth. Among the 35 countries where occupancy sat below 2019, 25 recorded occupancy rates just 10% below 2019 levels. 

Excluding provincial areas, country markets, and markets affected by fluctuating exchange rates, the top five RevPAR performers were Hong Kong, Abu Dhabi, Rome, Edinburgh, and Chennai. Sporting events played a significant role in stimulating growth in these leading markets, with Abu Dhabi hosting the UFC showdown week and NBA pre-season games, while Chennai hosted the Men’s Cricket World Cup. Hong Kong maintained its position in the leading markets, as the comparable period in 2019 was affected by continued protests.