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Greece experienced a 1.1% reduction in ADR but saw a 2-point increase in occupancy, leading to a 1.5% rise in RevPAR. – Image Credit Unsplash+
The European hotel industry experienced varied performance in August 2025, with notable declines in key markets, such as Germany and France, while smaller destinations, like Latvia and Hungary, reported growth.
As reported by HSMAI Europe and MKG, the European hotel industry in August 2025 displayed a mixed performance, with a 6.9% decline in both revenue per available room (RevPAR) and average daily rates (ADR), while occupancy rates remained relatively stable with a marginal increase of 0.1 points. The performance was notably uneven across different regions and market segments.
Germany continued to face challenges, with a downward trend that had begun earlier in the year. After a brief improvement in July, the market experienced a decline again in August. Domestic demand was insufficient to offset the decline in international visitors during the summer. Occupancy rates fell by 1.6 points, resulting in a 12.2% decline in RevPAR compared to August 2024, which had benefited from high-profile events such as concerts in Munich. The longer-term trend also showed a decrease of 1.8% compared to 2023.
In France, the market faced an unfavorable comparison with the previous year’s Paris 2024 Olympic Games. Occupancy rates decreased by 1.3 points, and ADR saw a significant drop of 15.8%, marking the steepest decline among the surveyed markets. France, having been one of the first countries to recover from COVID-19, is now experiencing a normalization of activity levels.
Conversely, Northern Europe exhibited positive trends. The Netherlands reported over 5% growth in RevPAR, supported by the SAIL Amsterdam event, which drew 2.5 million visitors. The United Kingdom continued its upward trajectory from July, with occupancy rates increasing by 0.8 points compared to both August 2023 and 2024. However, ADR decreased slightly by 0.4%, remaining below the country’s inflation rate of 3.8%.
In the Baltic region, Latvia and Poland saw increased tourist activity due to unusually warm waters. Latvian hoteliers raised ADR by 20.9%, aligning with the country’s inflation rate of 4.10% in August, while occupancy remained stable, resulting in a 22.6% increase in RevPAR. Poland experienced a 2.1-point rise in occupancy, though ADR fell by 3.7% compared to the previous year.
Central Europe also showed a strong performance, with Hungary achieving an 18.6% increase in RevPAR. This was driven by a 3.9-point rise in occupancy and a 13% increase in ADR, partly due to the Ziget Festival attracting 416,000 visitors. The event’s popularity exceeded local accommodation capacity, pushing visitors to seek lodging in Budapest.
Belgium reported positive results, with numerous festivals boosting tourism. The Czech Republic saw a 5.8-point increase in occupancy, though ADR declined by 6.4% compared to August 2024. Events such as Prague Pride and the International Contemporary Circus Festival contributed to the influx of visitors.
In Southern Europe, the market dynamics varied. Greece experienced a 1.1% reduction in ADR but saw a 2-point increase in occupancy, leading to a 1.5% rise in RevPAR. Italy’s RevPAR increased by 0.6%, despite a 2% decline in ADR, with occupancy rising by 1.8 percentage points. Portugal’s hotel capacity continued to expand, stabilizing occupancy at around 85%, but ADR decreased for the second consecutive summer, resulting in a 1.7% decline in RevPAR.
Spain, however, reported positive growth, with a 1.8-point increase in occupancy and a 4.9% rise in ADR. The country’s appeal as a summer destination was bolstered by numerous events, contributing to a 14.6% increase in ADR compared to August 2023.
Overall, the European hotel industry in August 2025 demonstrated diverse performance, with some regions facing challenges while others capitalized on events and favorable conditions to boost their metrics.
