Trends in Europe March 2025: a two-speed hospitality business

In March 2025, the European hotel industry displayed a varied performance, with fluctuations seen in different segments, particularly the budget and economy sectors, as domestic customers faced challenges in increasing their stays due to economic conditions. While Eastern Europe showed strong growth, other regions like North-Western Europe struggled to recover positively.

The performance of European hotels differed significantly across various segments. The budget and economy sectors, which had achieved some stability in the previous month, experienced declines in Revenue per Available Room (RevPAR) of -10.2% and -2.4% respectively. The midscale segment also saw a slight decrease in performance (-0.5%), while the upscale segment was the only one to maintain a positive trend (+0.9%) due to international clientele.

The competition between Eastern and Southern Europe continued, with Eastern European countries such as Latvia and Hungary, alongside Greece, showing significant RevPAR increases. Greece reversed its previous month’s trend by recording a rise in RevPAR from -1.1% in February to +11.9% in March, driven by improved occupancy rates and average daily rates following a decline caused by earthquakes. Latvia maintained its second position with a RevPAR increase of 10.3%, aided by high occupancy rates and a diverse events calendar. Hungary moved up to third place with a RevPAR increase of +7.3%.

Additionally, Greece saw a rise in tourist numbers as the impact of natural disasters subsided, while Latvia remained competitive despite a decrease in average daily rates. Hungary’s improved performance contributed to the overall positive trend in Eastern Europe.