Skift Take
While the financial crisis drags down room rates in Europe, big cities in Latin America are flexing their muscles and attracting business travelers who are paying higher room rates.
If you thought hotel rates in New York City or San Francisco were off the charts, just plan a stay in Moscow, Lagos or Geneva.
These three cities in Europe and Africa notched the highest average daily rates from January to June 2012, according to the latest bi-annual survey from travel management company Hogg Robinson Group.
The top three cities for hotel stays were Moscow ($405), Lagos ($340), and Geneva ($339).
Priciest hotels
Lagos, Geneva or any other of the 47 cities surveyed are not likely to take away top honors — if you can call it that — from Moscow any time soon as it is “far and away” the most expensive destination for hotels in the survey and has been so for the past eight years, HRG says.
Hotel prices in Russia’s capital climbed 3% in local currency, compared with the first six months of 2011.
Lagos attracts a ton of in-bound business travel because of Nigeria’s oil industry, and its ranking as the city with the second-highest hotel rates is skewed by the fact that these visitors tend to stay in five-star properties because of the dicey security situation, HRG says.
Geneva’s rates actually fell 5% during the first half of the year, but it still managed a spot in the top-three cities with the most expensive hotel rates.
Among U.S. cities, New York City ($319) ranked sixth; Washington, D.C. ($301), was 10th; and San Francisco ($283) came in 12th among the 50 cities, the survey found.
Latin America
On a regional level, Latin America posted the strongest growth in room rates, HRG states.
Average rates increased 30% in local currency in Mexico City, for example, and this was driven by increased demand and a lack of new hotels, HRG says.
“The city has approximately 24,600 rooms in the mid and upscale sector and this is only expected to grow by 4-5% over the next three years, further driving up rates in the future,” HRG states.
And, Rio de Janeiro and Sao Paulo saw room rates rise 15% and 23% in local currency, respectively.
Rio de Janeirio rode a strong convention season, including hosting the UN Earth Summit in June, HRG notes.
Sao Paulo is seeing an influx of business travelers as its foothold in the financial sector grows.
Europe and India
In other regions, Europe saw average rates fall in key cities because of the financial crisis. For example, rates decreased in Barcelona (22%), Madrid (2%) and Dublin (6%).
Going against the grain, room rates rose about 2% across the UK, with London and Liverpool, which is seeing growth in its automotive sector, both showing gains during the first six months of the year.
In India, room rates in Mumbai and Bangalore fell 7% and 21%, respectively, in local currency in large part due to the country’s economic, slowdown, HRG says.
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