Published on
September 2, 2025
The European hotel industry displayed mixed results in June 2025, showing a significant difference in performance across various regions. According to recent data, the overall growth in Revenue Per Available Room (RevPAR) in Europe was modest, but certain markets, especially in France and Eastern Europe, experienced positive results, while countries like Germany and the UK saw downturns. This variation is linked to several factors, including international events and local market conditions.
RevPAR Growth Across Europe
Europe’s hotel industry reported a modest increase in RevPAR of 1.4% for June 2025, driven by a slight rise in occupancy rates, which saw a gain of 0.5 percentage points. However, Average Daily Rate (ADR) experienced a small decline of 0.8%, indicating that despite more rooms being occupied, the rates charged per room were somewhat weaker. The region’s inflation rate was reported at 2% for June 2025, adding to the broader economic challenges for hoteliers.
Germany and the UK Experience Declines
Germany, one of Europe’s largest hotel markets, saw a considerable dip in its hotel performance in June 2025. RevPAR dropped by 20.3% when compared to the same month in 2024. This decline can largely be attributed to the absence of the Euro 2024 football tournament, which had provided a significant boost to the market in 2024. Year-on-year comparisons also showed a 7% drop in RevPAR, with both ADR and occupancy rates falling. So far, in 2025, Germany’s RevPAR has decreased by 1.2%, continuing the downward trend from the first half of the previous year.
The United Kingdom followed a similar pattern, with a 0.8% decrease in RevPAR from January to June 2024. Although occupancy rates remained steady, demand for hotel rooms lagged, preventing a significant increase in ADR. Consequently, hoteliers faced a 3.3% drop in RevPAR for June 2025.
Southern Europe Shows Slowdown
In southern Europe, markets that had earlier shown promising performance in 2025, particularly coastal areas, started to slow down in June. Spain, a major destination in the region, saw a modest 0.8% increase in RevPAR, driven by a 1.7% rise in ADR. However, this increase was offset by a decline of 0.8 percentage points in occupancy rates. Similarly, Portugal’s hotel market showed a slight decrease in occupancy rates, resulting in a 0.3% dip in RevPAR, despite a 0.7% rise in ADR.
Greece, facing a challenging period, experienced a notable 4.1% drop in RevPAR, with both occupancy rates and ADR declining during the month.
France and Eastern Europe Shine Brightly
In contrast, France’s hotel industry emerged as a standout performer in June 2025. The country saw a substantial 13.8% increase in RevPAR, primarily fueled by a strong 3.5 percentage point increase in occupancy rates. Paris, in particular, experienced a surge in demand, particularly from international tourists, which allowed hotels to increase their ADR by 8.7%. This growth marks the highest RevPAR increase in Europe during the month.
Eastern Europe also demonstrated positive trends. Poland, Latvia, and the Czech Republic all reported increases in RevPAR. Poland saw a rise of 8.9%, while the Czech Republic experienced a more robust 12.6% increase. Latvia also performed well, with a 4.9% increase in RevPAR, thanks to gains in ADR.
Corporate Demand Remains Weak
Despite these regional differences, one common trend across Europe is the persistent weakness in corporate demand. Many businesses have yet to return to pre-pandemic travel patterns, impacting hotel performance in major business hubs. As a result, the hotel industry is turning to other strategies to boost revenue, such as offering additional services to increase customer spending.
Looking Ahead: Challenges and Opportunities
While the overall growth in the European hotel industry remains modest, certain markets continue to thrive. With international tourism on the rise, particularly in France and Eastern Europe, hotels are finding new opportunities in catering to high-demand visitors. However, the ongoing challenges in corporate travel and fluctuating local conditions suggest that the industry will need to adapt and innovate to maintain consistent growth in the coming months.
