MARKET REPORT |
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per available room, up from € 2.3 prepandemic. Sales & Marketing expenses remain elevated at € 2.3 PAR as operators work harder to drive incremental revenue, while rising loyalty program costs— driven by increased points issuance and promotions— continue to erode margins. |
The Labor Challenge
Payroll PAR – 2025 vs 2024 % Change – Europe
Rooms 5.4 %
F & B 3.8 %
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A & G
S & M
|
4.2 % |
5.3 % |
WHAT COMES NEXT Europe’ s hotel sector has moved beyond recovery and into an optimization phase. Revenue is still growing, but margins are flat, costs are structurally higher and profit conversion is under strain. What comes next will be defined by operational precision, not demand growth.
“ Hotels that succeed in this environment will be the ones that understand profit at a granular level,” said Michael Grove, CEO of HotStats.“ That means knowing exactly where revenue is generated, where costs are rising and where action will have the greatest impact.”
In today’ s market, profitability is no longer about chasing growth— it is about precision profit engineering. HotStats, now a Duetto company, is a global data benchmarking company for the hospitality industry.
Other
Pay PAR
4.7 %
Further down the P & L
Pay %
6.5 % P & M
0.5 pts
GOP %
Undistributed departments other expenses PAR – 2025 vs 2024 % Change – Europe
6.3 %
Credit Card Commissions
6.5 %
-2.3 %
4 %
-1.1 %
S & M Expenses |
Utilities |
Waste Removal |
Repairs & |
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Maintenance |
6.5 %
0.1 pts
3.2 %
Loyalty Programs
-2.2 %
Franchise & Affiliation Fees
TRevPAR, 2.7 %
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Brian Levine, Publisher
blevine @ hotelsmag. com
76 hotelsmag. com Mar / Apr 2026