The profitability of hotels operated by international hotel chains grew by more in Budapest than in any other European city in May, according to the latest HotStats survey by TRI Hospitality Consulting, summarized by Világgazdaság (subscriber only). TRI said the explanation for the results is that Budapest hotels considerably reduced their expenses, for example, by laying of staff.
Data show that daily profit per one room calculated before fixed expenses (IBFC PAR) increased by 34.5% to €62.54 in Budapest hotels in May compared to one year before. The survey involved the Hungarian units of international chain, such as InterContinental, Marriott, Park Plaza, Le Meridien, Corinthia and Kempinski, said Ben Walker, research leader of TRI’s London center. Examined hotels include 2,074 rooms of the total of 17,848 in Budapest.
Meanwhile, the profitability of Hungarian-owned hotels is decreasing, said István Kovács, secretary of the Hungarian Hotel Association. One reason is that supply in the market has grown tremendously, while demand has been stagnating, which affects Budapest hotels especially. As 75% to 80% of guests at Budapest hotels are foreigners, these hotels do not benefit from improving domestic tourism.