Greek hoteliers pessimistic on Q3 2012

Mainly due to the continuing political and economic uncertainty around Greece in the second quarter, international arrivals declined 4.6% overall comparing the first six months of 2012 and 2011, according to a new report from GBR Hospitality.

Athens showed the biggest drop of all international airports in Greece of 15.1%, while Thessaloniki saw their international arrivals increasing with 7%.

As a result the RevPAR of Athenian hotels saw a significant drop of 28.4% in the second quarter, while Thessaloniki hoteliers saw their RevPAR increasing with 16.6%. The resort hotels did not have a good start of their season with a drop of 4.1% in terms of RevPAR comparing Q2 of 2012 with 2011.

The major uncertainties that emerged during the prolonged election period and their continuation owing to the as yet unknown outcome of negotiations with representatives of the countries creditors are the main two reasons for the worsening of the country’s economic outlook.

Data from the Bank of Greece reveals that travel spending by non residents fell 12.5% year-on-year May, reflecting also a decrease in non-residents’ arrivals at an average year-on-year May rate of 10.8%. Travel receipts in the period of January – May 2012 were €211 million (US$260 million) less compared to the same period last year which reached €1.4 billion (US$1.7 billion). Over the same period Greece received 336,600 less visitors, reaching a level at 2,784,100 for the first five months of 2012. Almost 10% more British traveled to Greece though in these first 5 months, but spent less than other years. The number of Germans declined with nearly 10% and also the number of Russians dropped with more than 21%.

Immediately after the June elections and the formation of a new Government, bookings to Greece were on the rise as the headlines on Greece in the press disappeared. According to market sources most traditional source markets of Greece picked up, but booking numbers remain well below those of the previous year.

Hoteliers are also pessimistic for the third quarter of this year, after a difficult first half. As a result hoteliers are expecting to close the year of 2012 with a significant drop in both occupancy and room rates. Very few hoteliers expect improvements in occupancy levels and room rates. The majority predicts a drop in occupancy and ARR for their own properties, but also for the market overall.