M a r k e t I N F O R M AT I O N F R O M PA N D O X – O N E O F T H E L EA D I N G H O TE L P R O P ERT Y C O M PA N I E S I N E U R O P E
returns to growth
positive outlook on many hotel markets
S po t ligh t
for the hotel
– a smoking
Handball a path
to prosperity in
JUST A WORD
US leads the way in the hotel market
The European hotel market is in an early recovery phase.
Despite some contradictory signals, there is significant
support for this view. The macro economic situation has
stabilised, most economists talk of lower global risks.
Indications from the banking sector point to a renewed
increase in credits given, which, in turn, is an important
catalyst for increased activity levels in general, as well as
an increase in travel specifically. We can already see this within the hotel industry
– demand in Europe has increased by 2.2 per cent this year up until September
and it is particularly noticeable in the transient volumes. The trend is positive as
we can see that both international and domestic travel is increasing – making up
two large sectors that drive growth simultaneously. We can also see an
increased demand in the meeting and conference segment, particularly in cities
with a high proportion of international visitors. In addition, we can see that the
stable demand within individual tourism and short breaks remains intact.
If you look at the US, which is normally 2–3 quarters ahead of Europe in the
demand cycle, we can see that good growth is generated. RevPAR has
improved by 5.6 per cent during this year, with price as a component accounting
for half of the growth. The short term trend is encouraging with firmer prices
improving the bottom line. When looking at cities in the US, Chicago (+5.9 per
cent), Los Angeles (+6.9 per cent) and Miami (+11.0 per cent) are worth a
pecial mention. New York has seen strong growth over the last few years and
is currently clocking an impressive 7.1 per cent increase in RevPAR on a rolling
The high level of activity in the US is good news for Europe. We can see ripple
effects forming strong patterns of growth in large international markets such as
Paris, Berlin and Amsterdam.
London’s revenue development is worth a special mention – despite the fact
that new capacity makes up a large slice of the market, partly due to the demand
generated by the 2012 Olympics, the city’s RevPAR is stable compared to 2012.
If you look at the Scandinavian hotel market from the same perspective, we
can see that revenues will gradually improve and that the factors for a solid end
of the year are in place. With this in mind, we can look at 2013 as a rollercoaster
ride; a weak start formed a sharp initial drop in revenues while the end should
prove to be smooth. The greatest improvement can be seen in Copenhagen
which has experienced growth of 5.4 per cent in RevPAR, albeit from low levels.
Helsinki is in a worrying negative trend, partly due to a weak economy and partly
due to comparisons with a fairly strong 2012. In Stockholm, we can see a slight
decrease in revenues with the conference segment impacting negatively on
weekday occupancy rates while the demand at weekends has remained table.
With the current trend as the starting point, we can expect to see a stronger
start, in general, in 2014 compared to this year. Stockholm, in particular, has a
stronger conference and congress year to look forward to, with a scope for
increased average price due to a shift in segments.
The challenge for the Scandinavian and European hotels next year is to
successfully increase the average price charged. Despite a decent demand
situation over the last five years, room prices have barely moved since 2007.
Market information from Pandox
– published approximately three
times a year.
Editors: Anders Nissen,
Marika Hilldoff, Ingrid Löwy
Address: Pandox AB (publ)
P.O. Box 15
SE-101 20 Stockholm, Sweden
Tel.: +46 (0) 8 506 205 50
Fax: +46 (0) 8 506 205 70
Vasagatan 11, 9th floor, Stockholm
This is a worrying development as a higher average room price is a vital component for a much needed improvement in the hotel industry’s profitability.
Building less new hotels would be one way to increased profitability. New
capacity can sometimes illuminate a city, but an increased supply and fiercer
competition can also result in profitability issues. When new hotels are built,
the winners are often the municipality, through increased tax revenues and
higher employment, as well as the building companies that win the contract
and consultants that can profit on their advice.
I was a panel member during a debate at HotE in London, one of the larger
conferences in the European hotel industry and one that primarily caters to
the financial markets. The debate concerned which contract form, lease or
anagement agreements, resulted in the highest value growth for the hotel
property. The answer was unanimous: the lease structure is the more sophisticated format. The reason that emerged was that it creates a balance between
owner and operator through a share in revenues as well as investments, while a
management agreement has the opposite effect with the owner taking 100 per
cent of the risk while the operator benefits on the upside – that is not how you
build a good artnership.
This is not exactly news to me, having been involved in the hotel business for
some time. What did surprise me at HotE though, was that a large number of
the audience had little experience in how a lease agreement works. It was particularly apparent that a number of advisors, often London-based, couldn’t
explain the benefits of a lease agreement and instead recommend investors,
who often run a passive investment model, to agree management deals with
cunning international hotel operators, resulting in an unequal share of the risk. In
my world, this is poor advice indeed and this is definitely a subject to revisit.
Writing this, I still don’t know if Sweden has managed to qualify for the World
Cup in Brazil. What if we miss out on another large competition – it would feel
very empty come June 2014! An exciting championship that we are sure to be
able to look forward to, is the European Handball Championships in Denmark.
Sweden’s group is scheduled to play in Copenhagen and the first game is
against Montenegro on the 13th of January at 20.00. The other teams in the
group are Croatia and Belarus. In case of a play-off, we will probably face
France, Poland and Hungary. Handball is for real. There aren’t any also-rans in
a European championship. Every game is a battle, often settled in the last minutes.
The Danes love their handball and a great party is planned. When Denmark
faced Spain in the last Handball World Cup final, more than 60 per cent of the
population watched it on TV. This is thought to be a record across all categories.
The topic of this year’s Hotel Market Day is ”Demographics and changes in
consumption patterns”, a current and interesting subject. We are very proud
to present a number of international speakers, such as Richard Dobbs from
McKinsey Global Institute and Chris Sanderson from the Future Laboratory,
as well as exciting Swedish names such as Klas Eklund from SEB and Scandic’s
Magnus Berglund, as part of the programme.
Graphic design and production:
Hallvarsson & Halvarsson
Photos: Ulf lomberg, Markus
äckström, Peter Hoelstad, IStock et al.
Cover: The Hotel, Brussels.
UpGrade can be ordered from Pandox
at firstname.lastname@example.org or read at
Printing: TMG Sthlm, November 2013.
May be reprinted only with the
ermission of Pandox.
market information from Pando x
Choice acquires three large hotels. Nordic Choice
Hotels acquires Amaranten, one of the largest hotels in
central Stockholm, as well as Hotel Skt. Petri and Hotel
Vesterbro in Copenhagen. In addition to acquiring the
properties, Nordic Choice Hotels will also take over
operations from First Hotels.
Fabege signs a 20-year lease with The Winery
Hotel in Solna. The new hotel will be opening at the
end of 2015. Apart from 184 rooms, the property will
also house a winery and a ”vinotheque”.
highly designed. The name of the new chain will be
HTL. The first new hotel will open with 275 rooms in
May 2014 on Kungsgatan in central Stockholm.
The goal is set for 20 hotels based on the HTL concept
within the next 5 years, achieved mainly through
onversions of office space.
Comfort Hotel Winn opens in Umeå. Umeå’s new
hotel – Comfort Hotel Umeå – was inaugurated on the
14th of September. The hotel boasts 185 rooms and
is situated in the Forsete neighbourhood, between
Kungsgatan and Rådhusesplanaden. The property
reaches 52 meters above ground while under ground,
the hotel sits above the new shopping centre Utopia
which will open on October 24th. Interior architect
Anders Björkén is the designer.
Scandic Karlstad City relaunch. On the 13th of September, after 18 months of refurbishment, Scandic
Karlstad City reopened with 41 new rooms, a new
estaurant, function room, meeting room and a new
Spa area featuring Jacuzzi and sauna. The number of
rooms has increased to 145.
New hotel at the Ulriksdal train station in Solna.
Peab will to build a hotel at the Ulriksdal station which
(including retail space) will have a total floor space
of 8 000 square meters. A 15 year lease has been
signed with the Gothenburg based hotel operator,
Ess Hotels, who will run the hotel which is expected
to open around the new year 2015/2016. The hotel
will have around 200 rooms and be marketed under
the Park Inn brand.
Gothia Towers add 5-star sister hotel. On September 1, the doors were opened to Hotel Upper House
which comprises 49 rooms, a restaurant and a three
story Spa. Upper House has been built on top of the
Gothia Towers second tower and covers floors 18
to 25. During spring 2014, the hotel will be expanded
with the addition of ten Deluxe Suites.
Scandic launches new hotel concept. Scandic has
introduced a new brand for its new range of city hotels
which will have lower room prices and also smaller
rooms than its Scandic brand. The hotels will have
remium city centre locations within the Nordics, be
space efficient, have smart digital features and be
market information from Pandox
Story Hotels opens at a second venue. Story Hotel
Signalfabriken is situated in the regenerated area near
Torget 1 in Sundbyberg. The hotel opened on the 26th
of September featuring 83 rooms, gastro lounge and
bar. Another Story Hotel will open in Malmö in 2016
and the group is also looking at options to locate in
Copenhagen, New York and Istanbul.
Host Hotels & Resorts acquires Sheraton Stockholm.
US-based REIT Host Hotels & Resorts has acquired
the Sheraton property in Stockholm. The deal was
completed towards the end of the summer with, also
US-based, Blackstone on the selling side. The property covers 22 000 sq m with 454 rooms. It is Host’s
first foray into the Nordics. Blackstone completed
a major renovation project of the property in 2006,
shortly after its purchase, with a total bill well past the
100 million Krona mark.
The ”Gallerian” shopping mall in Stockholm may
host three new hotels. AMF properties is planning for
three new hotels in a space near ”Gallerian” shopping
mall in the quarter which currently hosts Swebank’s
HQ. Annordia (formerly HåP Konsult AB) has developed a new concept comprising three hotels in different categories with a total of around 700 rooms. The
hotel draft is currently being marketed to hotel operators and bids are to be submitted during November.
Another Malmö hotel. A new hotel containing about
160 rooms is planned to be built in, what was, kånska
Dagbladet’s premises in central Malmö approximately
300 meters from the Central Station. The hotel will
cover 7 000 sq m of which 3 200 sq m is in a completely new extension. The property will remain owned by
Skånska Dagbladet through a foundation.
Hotel property transaction volumes in EMEA up
50 per cent. According to JLL, hotel investment volumes across Europe, Middle East and Africa (EMEA)
reached €8.2 billion September YTD 2013, a 53 per
cent increase compared to the same time last year.
In terms of portfolio sales, Private Equity firm Gecina
sold four Club Med holiday villages for €280 million as
part of the company’s strategy to focus on the remaining core business assets, while Spanish-based Derby
Hotels Collection bought the remaining 50 per cent
stakes in the Caesar Hotel in London and the Banke
Hotel in Paris for €240 million from Investment Fund
Focus on the market
– accelerating recovery
Solid recovery in the world economy
Five years on from the Lehman crash, many
countries, Eurozone countries none the least,
are still combating weak growth. Experts
believe that the tipping point has been reached
though, and that a brighter global economic
picture is now emerging. The Eurozone has
returned to positive growth, the US and Japanese economies are continuing on the path of
expansion and China and Brazil are showing
signs of improved growth. However, we still
have risks in the form of political wrangling in
the US, high national debts within the Eurozone
and sluggish economic expansion in some of
the emerging markets such as India, Turkey
Clear signs of recovery in the US and levelling out
After a number of years of financial cuts, the US
economy has retained more balance due to
increased economic activity. Property prices are
rising, households are enjoying increased purchasing power, employment is on the rise and unemployment is expected to continue to fall to the 6 per
cent mark already in 2014. Political risk has not
receded though. The political wrestling between
the Republicans and the Democrats over the
budget is negatively impacting the economy and
makes it harder to predict the future. However,
most commentators believe that the US is on the
verge of a great leap in the economy during 2014–
2015 and that annual growth will hit 2–3 per cent.
In China, growth figures have improved somewhat, alleviating the pressure on global markets,
and during the third quarter, the economy strengthened further compared to previous periods.
An upturn in Japan is also in the cards. For other
emerging markets, such as India, Brazil and Turkey,
there are still risks of increased financial turbulence
and high levels of inflation.
Europe is on the right track, but progress is slow
The clouds over Europe have lifted somewhat over
the past six months. After 18 months of falling GDP,
the Eurozone exited recession during the second
quarter of 2013, recording quarter-on-quarter
growth – albeit from a low starting point. Among
the green shoots observed, the German economy
sets itself apart with a more positive development
than expected, making it the driver of the successive stabilisation in Europe. The number of austerity
measures has also shrunk, which bodes well for
There are still a number of challenges left for the
Eurozone though. For example, Italy and France
have not yet started to see an improvement in their
competitiveness levels, while unemployment is still
worryingly high and inflationary pressure low.
Outside the Eurozone, the UK has experienced
higher growth than expected over the summer.
The service and the building sectors are particularly
strong and growth indicators point to continued
BRIGHTER OUTLOOK FOR SCANDINAVIA
Sweden – the fastest growing Scandinavian
conomy – in a recovery phase
2013 was a year signified by weak economic
growth for the Swedish economy and GDP growth
is predicted to reach a meagre 1 per cent. However, there are number of signs that point to better
times ahead; the currency will strengthen compared to the Euro, growth will accelerate when
export markets improve and strong household
finances (to a large part due to an election friendly
budget) will increase purchasing power. Sluggish
wage growth will contribute to a slow rise in inflation though.
Norway’s economy hits the bumpers
Since last spring, the Norwegian market has gone
from booming to anaemic. Falling house prices
combined with a lower price for crude-oil and weak
household demand are seen as the greatest risk
factors for the Norwegian economy. Collectively,
these factors contribute to put a dampener on
GDP growth and the 2014 growth forecast has
been lowered to around 1.5 per cent.
Finland, stuck in recession
In line with previous forecasts, Finland has the
more negative outlook. The Eurozone crises and
higher taxes are straining the economy, GDP is
alling for the second consecutive year and drivers
of growth are still absent. Much like Sweden,
inland relies heavily on exports to a struggling
Eurozone. A second important market is Russia,
but with the Russian economy also in a deep dip,
there are few short term signs of improvement
for Finnish exports.
Denmark sees the light at the end of the tunnel
Denmark is arguably the Scandinavian country
which has suffered the most from the financial
rises with property prices dropping for several
years. However, a recovery may be in sight.
roperty prices, mainly in Copenhagen, have
started to improve. Recovery is still slow, though,
and the underlying strength of the increased
growth is fairly weak.
market information from Pando x
Hotel Market Overview
The global economy is expected to strengthen further next year. This will obviously impact the hotel
industry and have a particularly positive effect on
the meeting and conference segment. In addition,
increased consumer confidence will continue to
grow the leisure sector, with an increased demand
for holidays and city breaks. The forecast is positive
as both national and international travel is increasing with these two large segments driving growth
In most markets, volumes are considered to
be at relatively good levels post the financial crisis,
which establishes a good foundation for an
increase in prices. For 2014, healthy growth is
anticipated both in demand and rates.
The US and New York
The American hotel market also continues its positive development in the third quarter and continues
to develop in tandem with the national economy.
The short term trend is positive, a further firming of
prices results in improved profitability.
Since 2012, the US has seen a stable RevPAR
growth of around 6 per cent and that was also the
case at the end of September. Price continues to
be the driver of growth thanks to a strong corporate segment.
The New York market, which previously has performed below the US average, has experienced a
strong start to the year and is showing growth in
RevPAR of 6.5 per cent at the end of the third quarter. Contrary to previous quarters, where volume
was the driving factor, price is currently supporting
more than 50 per cent of growth. Other large hotel
markets such as Chicago (+5.9 per cent), Los Angeles (+6.9 per cent) and Miami (+11.0 per cent) have
also developed very well.
Normally, Europe lags the US by two to three quarters in the hotel market life-cycle which gives us
hope for solid growth here as well. In addition,
fewer uncertainties will hamper the European hotel
market as the economy stabilizes. Thus, a positive
trend is to be expected even it is yet to be seen
clearly in the numbers.
RevPAR change for the European market
landed at 0.6 per cent at the end of September,
compared to the same period last year. As previously, there are huge differences between countries, regions and segments. So far this year, the
southern part of Europe has had the strongest
development, while the northern regions have been
the weakest in terms of yearly RevPAR growth.
The PIIGS countries have shown particularly strong
RevPAR growth with a majority of markets having
managed a turn around after a sustained period of
weak numbers. All the capitals in these ”crisescountries”, apart from Madrid, have seen visible
RevPAR growth (YTD Sep): Dublin +10.3 per cent,
Lisbon +6.5 per cent, Athens +6.3 per cent, Rome
+1.5 per cent while Madrid came in at a negative
– 6.8 per cent.
The London market has seen more stable
development than originally anticipated as good
weather and a continuing post-Olympic boom
is having a positive effect on tourism in the city.
Despite the number of large events in 2012 with a
marked increase in capacity in preparation for the
2012 Olympics and other events, the city’s RevPAR
market information from Pandox
is well in line with the previous year. At the end
of September, RevPAR showed a negative
–1.7 per cent growth mainly due to lower prices
compared to 2012.
The Berlin hotel market had a very good 2012
and the positive trend has continued in 2013,
to a large extent because of promising tourism
development. The future also looks bright. The
hotel development pipeline will slow down after
a decade of significant increase of supply and
the new Berlin Brandenburg International Airport
(scheduled for 2015) will improve international
accessibility which will boost both the MICE and
leisure egments. During the first half of this year,
growth con inued, albeit at a slower pace, but the
autumn numbers show a drop in RevPAR com
pared to a year ago. So far this year, the market
has dropped by 0.7 per cent.
The 2013 hotel year in Scandinavia got off to a
weak start. The main markets have seen incon
sistent development. All the markets in the Scandinavian capitals are facing the same challenge
– how to increase the average price charged?
The strongest growth was seen in Copenhagen
which saw progressive expansion during the
autumn and a RevPAR growth of over 10 per cent
by the end of September. The market is growing
from low levels and benefits from an improved
conomic outlook as well as the fact that limited
capacity has been added during the year.
Oslo has enjoyed nice stable growth during the
year, despite the large increase in capacity during
2012 (Scandic Fornebu, Quality Hotel Expo and
Comfort Grand Central) and 2013 (The Thief).
Helsinki is in a negative trend, partly due to a
meagre macro-economic climate and partly due to
comparisons being made to a strong 2012 with a
number of large events. In 2012, and earlier, the
local hotel market in Helsinki has been supported
by a steady increase in visitors from Russia, a trend
that flattened out during 2013 though. Therefore,
the drop by 6 per cent in RevPAR didn’t come as
a total surprise.
Stockholm shows a slight revenue drop for the
year with the conference segment negatively
affecting weekday occupancy rates while weekend
demand has remained stable. Underlying demand
has been hit by a drop in the business travel segment which has had a negative impact on room
prices at the same time as occupancy rates have
been affected by an increase in available rooms.
RevPAR was down 1 per cent with a short term
forecast for flat growth after the third querter.
A number of recently opened hotels, as well as
a growing pipeline of projects, is however an indication that investors and operators still have faith
in Stockholm as a future growth market.
The hotel capacity is steadily growing, both in
terms of numbers of hotels and in available rooms.
In 2012, there were 297 hotels in the Stockholm
County, about half of them located in the City of
Stockholm. The number of hotel rooms in Stockholm
County was 29,200 on average – an increase by
over 5 per cent compared to 2011 and almost
50 per cent more than a decade ago.
First Hotel Copenhagen.
RevPAR growth development
Source: STR (YTD September).
Source: STR (YTD September).
Source: STR and Benchmarking Alliance (YTD September).
The Hotel Market Day is a regular annual event arranged by Pandox since
1997. It is a dynamic meeting place for the hotel industry – a day filled
with hot topics, interesting speakers and networking.
topic of the day
meet two of this years speakers
Klas Eklund, Senior Economist at SEB and Magnus Berglund, Director of Accessibility at Scandic Hotels
Change will never be
as slow as today...
Chart the correct course among the trends
Concepts and labels of current trends are multiple and there are no clear or obvious definitions.
Different oracles and trend strategists point to
various trends while perhaps actually talking
about the same thing? UpGrade presents a path
out of the confusion and identifies the most
important trends for the hotel industry.
Just about every day, another oracle will come out
in the media with a prediction on where the world is
heading, how our lives will look tomorrow, next
spring or in ten years. They paint scenarios in the
short or the long term, referencing mega-, macro-,
and micro trends. But what do those labels mean,
and what sets them apart from each other?
UpGrade has investigated the issue and, as far as
we understand, this is the situation:
Mega trends: Large global changes in society affecting all areas – state, markets and civil
society – over the coming 10 –15 years. There is a
long list of megatrends, but frequently the underlying phenomena is the same but described in different ways. Many future strategists define mega
trends as our knowledge of what is likely to happen
in the future, even if the trend can change direction
or pace. Among other things, we know that the
wealth of all humans in the Western world will be
likely to increase by roughly 2 per cent per year.
Another mega trend is that the proportion of elderly
in western societies is increasing, while the proportion of youth is decreasing. Sometimes the term
giga trend is mentioned to describe a trend that
stretches over a longer time period with a time perspective of over 20 years.
Macro trends: Normally concerns a 5 –10
year time period. Macrotrends describe subsets
of mega trends as well as groups of micro trends.
Among other things, topics can include new ways
of working, new distribution channels, changing
family patterns and world events. The specific
trends which describe global financial changes are
often named, macro economic trends.
Micro trends: Short-lived, intensive and
angible changes that can be observed in, for
example, marketing, technology or lifestyle. It can
consist of local trends, pop culture, event driven
trends such as the World Championship in football
or the launch of a new book. Micro trends usually
serve as evidence of mega- and macro trends and
exist with a shorter time perspective.
The most important
1 Ageing The world’s population is ageing.
2 Globalization Globalization is the fast
growing global interconnectedness reflected in
the expanded flows of people, capital, goods,
services, information, technologies, and culture.
3 Technological development
4 Prosperity The majority of the population
of OECD countries and large groups in formerly developing countries are now growing
5 Individualization Individualization is the
shift from more collectivist societal norms to
more individualism. Man’s fate is now more a
question of interest and skill rather than obligation and tradition.
6 Commercialization The meeting of
increasingly more human needs on the private
market through trade that can be both supply
and demand driven.
7 Health and environment Sustained
development continues with renewed focus
on corporate social responsibility (CSR)
8 Acceleration A generally increased pace
9 Network organizing Cheaper transport,
Adjacently, we have listed the ten most important
megatrends according to the Copenhagen Institute
for Futures Studies. But which of these have the
greatest impact on the hotel industry? UpGrade
asked Klas Eklund, Senior Economist at SEB,
to share his view on these trends and in which way
they affect the hotel industry. Klas points to three
overriding trends which affect us all in a positive
better infrastructures, the Internet, mobile
telephony and increasing prosperity have revolutionized the opportunities for communication
and network organizing.
10 Urbanization Large-scale migration to
urban areas continues.
*The 10 most important megatrends according to the
Copenhagen Institute for Futures Studies.
market information from Pando x
Working life becomes more flexible
Youth travel continues to grow
As the pace of globalisation increases, companies
are establishing offices in more locations, domestically as well as internationally, which results in an
increased amount of travelling. Contrary to what
many previously believed, one cannot fully substitute the physical meeting with telephone or video
conferencing. Instead, the trend points to meetings
and conferences becoming even more popular,
which is also reflected in the industry statistics.
Over the past ten years, the number of work related
travels which included an overnight stay has
The youth culture of travelling before starting higher
education or obtaining a permanent position is well
established in many western societies such as the
Nordics. It is socially acceptable to take a few gap
years. A large part of today’s youth are brought up
in travelling families, they are accustomed to it and
wish to continue doing it. This travelling culture is
made even more accessible through increased
supply and a continuous pressure to offer low-cost
travel. This is obviously good for the travel industry,
says Klas, but less fortunate for the job-market
as a whole as the age at which a young person
establishes him or herself on the job market
increases, which in the longer term has a negative
effect on the macro economic situation.
The number of older travellers is increasing
A hundred years ago, the average life expectancy in
Sweden was around 60 years while the retirement
age was set at 67 years. As a result, most new-borns
never reached retirement age. Today, our average life
expectancy is 81 years and it is calculated that 10
per cent of Swedes living today will reach 100. For
those born after 2000, some statisticians believe that
half of them will reach their 100th birthday.
In general, today’s elderly, across the world,
have more money and are in better health than previous generations, which, in turn, means that they
will travel more frequently and stay longer at their
Emerging new markets
and guests with disabilities
– The two groups, travelling seniors and
guests with disabilities, are growing rapidly.
This trend is visible across the globe – two new
markets are emerging. The hotel industry is
ignificantly affected and it is vital to keep up
with these developments.
The words belong to Magnus Berglund, Director
of Accessibility at Scandic Hotels. Since 2003,
Magnus has strived to increase the knowledge concerning guests who have special requirements, and
how hotels can be adapted to serve them better.
During the ten years in his position, Magnus has
managed to create an Accessibility Standard,
established a new training programme for hotel
employees and collated and published information
on the internet which also includes advice on
accessibility at airports, during transit and in city
– The trend is that people with special requirements become more and more influential, says
Magnus. If the hotel cannot offer the right equipment and necessary aids, a company may choose
to book their conference elsewhere. That means
that, for example, a single wheel-chair user could
determine the choice of conference venue for
everal hundred guests.
market information from Pandox
However, for the hotels, it’s not just about being
able to offer shower-chairs, height adjustable
beds, hooks at different levels, vibrating alarm
clocks and fire alarms, special aids in the room or
an “allergy free” breakfast. First and foremost, it’s
a question of attitude, about treating all guests as
what they are, guests. And for the staff to acknowledge the individual client, while being attentive and
flexible in meeting his or her needs.
This is where Magnus has identified the main
challenge for the future.
– Lack of knowledge makes the guest feel
ingled out, which results in a poor overall experience, he says. What is encouraging though is that
the overall knowledge increases as the number of
guests with special requirements increases.
Magnus also notes that several competitors
have started to copy parts of Scandic’s work with
accessibility, which can only be positive.
– If no one was copying our work, I would see
that as a sign of failure, he says. And, speaking of
highly designed boutique hotels, it really shouldn’t
be more costly to include accessibility into the
design solutions. With simple measures, we can
achieve vast improvements, adds Magnus.
en route with his
Smoking hot hostel market
Rapid development in the hostel market
The hostel market has experienced rapid development and gone through massive changes
over the last ten years.
According to a new report from property consultancy Savills, hostels today are in the same place
as hotels were 15 years ago. Hostels have become
a more accepted and tangible alternative to hotels.
Supporting this trend is an increase in youth
travel, a larger supply of low-cost flights and greater
focus on affordable travel with a social dimension
among a broadening target group. Many operators
want to enter this market and we can expect to see
a future increase in branded hostels.
For most people, the word hostel brings back a
number of memories and associations. The mind
can quickly be transferred to bright memories of
youth, to backpacking trips in Asia, but also to
memories of budget hostels, catering mainly to
younger guests, with sunken, poorly made beds
and loud people next door.
However, the hostel market in many European
cities has gone through rapid development over
the last decade. A whole new market has emerged
and is expanding. More and more hostels are
being introduced under a trademark and are marketed as trendy and social with a boutique feel.
More than just a place to sleep
The basic traits are the same today as before:
affordable rooms, shared lodgings or communal
dorms of different sizes, with or without a bathroom, separate dorms for women, self-catering
and common social areas.
Today, however, a number of parameters have
been added to attract a broader, more mature and
more knowledgeable group of guests: smart marketing, central locations and an acute awareness
of social trends and new markets.
Contemporary, hip designs have been introduced in the community areas where guests can
mingle and meet new friends. Recurring events,
cool bars and music gigs all create a fun social
etting which also attracts local visitors who want
to hang out with their friends for the evening.
”Flash-packers” replaces back-packers?
The fundamental trend is that hostel guests are
growing older and become more conscious.
This was evident in another survey conducted by
NHC (Nordic Hotel Consulting). In this survey, it
becomes obvious that the age group 25–34 years
is the largest category, making up more than half
the demand for Europe’s hostels. One explanation
for this is quite simply that the previous back-pack-
ing generation has grown older, but despite the
fact that they can afford more expensive lodging,
they prefer to stay at places with a more relaxed,
social atmosphere. This group, defined as ”flashpackers”, is on the up.
Another surprise revealed in the survey is
that couples made up the largest group of travellers while the back-packers were actually the
smallest (please refer to Tourist Types in Hostels
in Europe below).
Expect more branded hostels in the future
According to Savills, the hostel market is still very
fragmented. Only 30 per cent of the hostels in
major European destinations are run under a
brand, as compared to the hotel market, where
80 per cent are run by a branded operator.
The same report assigns the greatest growth
potential for branded hostels to London and Paris,
considering the current low supply and extensive
youth tourism. Amsterdam, Dublin and Barcelona
are also expected to show considerable growth
over the next few years.
Unlike budget hotels, however, hostels have
more specific market and location criteria with a
preference for gateway tourist destinations. The
future expansion for hostels over the short term
New brand in the Scandic family
Scandic recently launched HTL, a new chain of
hotels aimed at a new generation of travellers.
The plan is to have 20 hotels up and running in
the major Nordic cities within five years. Stockholm will see its first HTL as early as May 2014.
The new hotel concept will offer the best city centre
locations at the best prices, with smart digital solutions and quality design features. HTL will primarily
be established through new builds and conversions, particularly of office buildings.
Stockholm will lead the way for the new chain
– in May 2014, the doors will open on central
Kungsgatan and in 2015 on Upplandsgatan,
near Norra Bantorget.
As a result of the digital revolution and a global
increase of tourism in general, new target groups
and new types of demands among guests have
sprung up, says Martin Creydt, Senior Vice President / CDO at Scandic. Centrally located hotels
that can offer the latest digital services, mobile
check-in and check-out for example, are more
appreciated than full service hotels with large
rooms, regardless of brand. We consider this
development to be exciting and, as a result, have
let our new hotel concept mirror these new trends.
As the product that we offer the customer is very
different from the current Scandic brand, we have
elected to create a new brand which better reflects
the new concept.
How do you define the target group for HTL?
– Price conscious travellers that prefer central
locations with affordable rooms that are supported
by a modern digital platform.
Which will be the main features to attract
the target audience?
– In addition to a central location near public transport hubs, HTL will offer high levels of design and
quality in all aspects of room interior, public spaces
and digital services. The heart of HTL will be the
service-lounge where guests will be able to get
breakfast and snacks around the clock.
Is there a risk that HTL will cannibalize on your
– On the margin – most of Scandic city centre
hotels are full service hotels offering everything
from bars and restaurants to conference rooms
and gyms. HTL is mainly a city centre room experience with the option to relax in an HTL-specific
I’m sure that some Scandic guests will test the new
concept and swap between the two depending on
the purpose and nature of the stay, but the main
part of HTL’s new customers will probably come
from competing hotels which cannot offer a product
that is as contemporary as ours.
It is my hope that HTL will complement the range
of hotels on offer in Stockholm and other ities in
Scandinavia. Apart from a handful of luxury hotels
and a few budget hotels in each city, most hotels
offer the same things, regardless of brand. Therefore, HTL will be able to fill an empty niche – which
we currently have named ”City compact” in our
roject, and which hopefully will enjoy increased
demand in the future.
Martin Creydt, Senior Vice President / CDO at Scandic.
market information from Pando x
Short survey hostel guests
will continue to be driven by private equity, attracted
by the current low penetration of branded supply,
low operational costs and ability to drive revenues
through F&B and other add-on services. On the
other hand, the ceiling in bed rates requires operators to have large sites in order to obtain the critical
mass that delivers optimum returns.
for a bed in dorm
20 – 25€ 45 – 70€
Why did they choose that hostel /
How did they find it
Berlin – a more mature market
The Berlin hostel market is considered to be the
most mature in Europe. The city has the highest
number of hostel beds (an estimated 16,200), and
guest nights of all European hostel markets.
Almost 60 per cent of the Berlin bed supply is
provided by branded international and national
operators. This could be compared to the London
hostel market, where only 40 per cent of the
16,000 available hostel beds are branded.
Berlin is Germany’s most visited city and ranks
among Europe’s top tourist destinations. The city
is still a lot cheaper than London or Paris and has
a reputation to be a young, hip and affordable destination, attracting visitors with history, culture, art,
architecture, restaurants, festivals and nightlife.
Generator Hostels is one of the brands that
has successfully entered the Berlin market. Their
recent opening of a second location in the city
clearly demonstrates their belief in a continued
positive trend in Berlin.
for private room
0% of the people said they
chose it based on recommendations from other friends
0% said they found the best
lists and reviews at:
0% said that they chose it
because of the “vibe” and
Tourist Types in Hostels in Europe (2010)
Design, facilities and location v.s rate
5% said that they are willing to
pay more to be able to be in
a good location and enjoy
a nice atmosphere
5% said that if the difference
between both rates is big they
would consider stay in “worse”
Organized tour groups
Source: NHC Data
What kind of service should be free
The main European hostel operators include
Equity Point Hostels
AO Hotels and Hostels
St Christopher’s Inns
100% answered WIFI
Pandox @ The Distribution Event
Pandox attended the first Hotel Analyst’s Hotel
Distribution Event at the Intercontinental Park
Lane in London. The full day event was the
first of its kind for hotel analysts and the event
attracted senior executives involved in sales,
marketing and technology within hotel brands,
operating companies and hotel property
owners. The topics discussed were loyalty
rograms, hotel guest data collection, reviews
and reviewers and OTA’s vs hotels – as well as
what future holds. Industry specialists from
companies such as, Tripadvisor, Google, Hilton,
IHG, Expedia, Citizen M, Accor, Choice Hotel
Scandinavia and PWC attended the event.
The loyalty panel debated topics such as “if a hotel
should control its loyalty program internally or join
forces with external companies such as Global
Hotel Alliance who are working with several hotel
chains. What is the difference between being a
small hotel operator vs a big chain in terms of loyalty programs? Should the loyalty program aim to
make the guest loyal to the hotel chain because of
its service offering and product or alternatively the
rewards which the loyalty programs provides?
Pandox believes that the fundamental pillar of
loyalty is guest satisfaction at the hotel level.
market information from Pandox
Reviews and “reviewing the reviewers” was the
topic for another panel debate where Carlzon
ezidor and Tripadvisor were two of the companies represented. One of the topics was if using
ripadvisor as a guest, market and guest satisfaction research tool, replacing the old survey based
approach, gives you all the answers? Questions
were also raised about the majority of “positive”
reviews on many sites and if those reflect an accurate picture of the hotel’s standard and guest satisfaction. Pandox’ concerns are that if the hotel
industry only reacts to consumer reviews, it will
lose its pro-activeness in product and service
Google held a presentation and continued to
deny that they will become an OTA. Google spoke
about their move into the travel industry and their
goal of controlling the entire circle in consumer
behavior and actions when planning, booking and
experiencing a trip. Google aims to provide internet
tools for all the four stages in travel, DREAMING –
RESEARCHING – BOOKING – EXPERIENCING.
The presentation also consisted of interesting facts
on device usage for Q2 in the UK:
• An average UK smartphone user looks at their
phones 150 times a day.
• 23 per cent of UK consumers aged 16–64 own
• For Google “Hotel queries” searches grew by
71 per cent for Mobile, Tablet 131 per cent and
desktop declined –6 per cent.
• 60 per cent of mobile hotel bookings are made
for check in within 24 hours.
Google is also continuing to develop Google Hotel
finder where the goal is to provide a “one stop
shop” when choosing a hotel , with info on location, reviews, prices, and hotel info on one screen.
Pandox’ question is why Google is not moving
into OTA’s – they seem to have the entire prerequisite for it?
During the OTA debate with the dramatic title
“The Big Face Off” Choice Hotels Scandinavia,
HRS, Expedia and IHG participated. The topics
mainly focused on how hotels and OTA’s can learn
to get along in the future. Like it or not, the OTA’s
are here to stay and it is up to the hotels and the
various players in the OTA industry to find a better
way to work with each other. Pandox views this
development positively and therefore welcomes an environment with less friction.
Overall Pandox viewed this event as very interesting and educational and believes that distribution is becoming an increasingly important part of
the value chain for hotels.
theme social projects
They call me
Julius of Handball”
He started out with nothing at the beginning
of the 1990’s. In the summer of 2013, Julius
Ndirangu participated in his 12th Partille Cup
– together with Pandox’ Handball Movement,
he has watched his Handball Club grow.
Name: Julius Ndirangu
Profession: Teacher and sports coach
Family: Three brothers, four sisters. Married to
Nancy. Two daughters, Brenda 16 and Sandra 3.
Favorite sport besides to handball: In my
youth I participated in steeplechase all the way
up to the national level.
Special talents: I am a talented swimmer with
skills developed by swimming in Africa’s fastest
river, The Gura. As a keen geographer I also
enjoy occasional game drives.
– To be able to showcase Sweden and a different
culture for these children forms a memory which
they will carry with them for life, he says.
The African man sweeps his right hand across,
from left to right. His face breaks into a broad smile.
– Look here. There are several thousands of children that meet down here. They play handball, but
it’s about so much more than that. They meet, talk
and exchange experiences. It’s fantastic, he says.
We are sitting in the heart of Gothenburg. The
Astroturf of the classic football fields at Heden has
been invaded – by handball players. Arriving from
all corners of the globe, they have eagerly gathered
to contest the 2013 Partille Cup. Julius M Ndirangu
is the man behind Kenya’s contribution to the sum
of 44 nations attending.
– This is the 11th time I’m here. We wait all year for
these days, to participate in the Partille Cup, he says.
He’s in charge of the 41 Kenyan children and
their four teams; two girls’ and two boys’ teams.
– To be honest, we’re not doing that well on the
field. These aren’t our best players. They couldn’t
afford to travel. Those who are here are the children
of the parents that could actually afford the flight
Not scoring many victories on the handball field
– the greater victory was gained from all the
– The best aspect of this is all the impressions that
the children bring home. They become a little bit
like ambassadors when they return home. They
bring the Swedish life-style with them. How people
behave. It’s more equal here, and it’s important for
the children to see that.
Kenya is a nation mostly known in sport for their
runners. Julius himself became acquainted with
handball when studying to become a teacher at the
University of Nairobi at the end of the 1980’s. When
he returned to his home town Nyeri at the beginning of the 1990’s he brought the game with him.
The sport is well suited for children that endure
tough living conditions.
Property is expensive in Kenya, but handball
pitches are small and cheaper to maintain. It’s a
very good sport in that respect.
But there were other problems.
– I tried to introduce handball in schools, but it
was difficult. Many headmasters were unwilling to
accept the sport. Football, basket and running
were the main focus.
As a result, Julius changed strategy.
– I started with the poorest kids in the slum. The
sport requires little space and is cheap to play.
The move was successful. Today, all of Nyeri’s
schools have handball on the curriculum – and
Julius is a celebrity.
Activities in the Pandox sphere:
The Shark project to enter next phase!
One of the largest hotel projects
in Scandinavia – ever
The Shark project is a joint venture between
andox and Scandic where SEK 1.6 billion is
invested in the upgrade and development of 38
existing Scandic hotels in Scandinavia. The project
was launched in 2012 and is due to be completed
City centre hotels that are part of the Shark
roject are, for example, Malmen in Stockholm,
Continental and Hilton Strand in Helsinki and the
KNA hotel in Oslo with aforementioned Continental
being one of the larger projects. At the moment,
the hotel is undergoing a complete step-by-step
renovation which, when finished at the start of
2015, aims to reconquer the position for the
ontinental as the leading meeting hotel in the city.
In Oslo, 35 rooms have been added and com10
pleted to the KNA hotel during the summer. The
addition was very successful and has been well
received by the guests. The project has moved on
to include existing rooms which will be finished by
the New Year when a much anticipated, complete
update of the lobby and reception area, as well as
the restaurant, bar and conference facilities, will be
the next phase.
Two thirds of the highway hotels complete
As part of the Shark investment scheme, sub project Moby represents the development of a new
generation of Highway hotels. The vision is to
renew and develop a common concept with flexibility and non-traditional solutions that takes new
family constellations, travel patterns and trends into
consideration. Each hotel’s unique history will be
integrated into different design elements, giving it
a local feel. As part of the concept the homely and
informal feel will be strengthened, more social
meeting places will be created and all the rooms
will receive a completely new interior and design.
Most of Scandic’s Highway hotels are included
in the Moby project, most of them situated in Sweden. Among those are classic and popular locations such as Kungens Kurva, near the E4/E20
motorway south of Stockholm, Backadal along the
E6 at Gothenburg’s western approach, Klarälven
on the E18 circular in Karlstad and Elmia on the E4
in Jönköping. The Moby project is progressing, on
schedule, and around the New Year 2013/2014,
about two thirds of all Highway hotels will have
market information from Pando x
– I don’t know what to say, but I suppose it’s some
kind of recognition. They call me “Julius of Handball”,
in Nyeri. The rich and the poor can play on equal
terms. That feels good.
Julius founded the handball club Mount Kenya
Sports Group. Aided by the Pandox Handball
Movement, the club has witnessed explosive
growth. From about a hundred members, the club
has grown significantly to 812 members (June
2013) in just a couple of years.
– We have managed to get an office. That is
solely because we have been able to structure the
activities with the help from Pandox. With that help,
we have been able to organise everything properly.
How does it feel seeing the organisation growing?
– It feels like we are on our way to succeeding.
With Pandox’ help, we are about to realise my
dream which started from scratch 20 years ago.
It feels fantastic.
The conversation comes to an end. As a leader,
Julius is constantly on the move.
– We went to Liseberg yesterday. It was a huge
experience for the children. Tomorrow we are taking
the boat (Paddan). They are all gaining an experience here that they will carry with them for the rest
of their lives.
Pandox Youth Handball Movement. In November 2011, Pandox established a project called
Pandox Youth Handball Movement in cooperation
with the Kenyan handball association Mount
Kenya Sports Group in the town of Nyeri. The
overall objective is that the cooperation agreement
shall provide young people with purposeful leisuretime, educational and training support, information
and advice regarding healthcare and other items,
as well as the possibility to carry out further social
projects around the town of Nyeri.
For further information regarding the project,
please go to www.msgkenya.com or
Do you know that:
Disturbing noise – is the no 1 nuisance
for hotel guests
TravelNews reports on an analysis of online guest reviews for over 5600 hotels in 20 famous
tourist destinations carried out by rating analysis company ReviewPro. In 19 of the 20 tourist
destinations that were analysed, hotel guests’ biggest complaint concerns noise. Hotel elevators is the second most frequent complaint, followed by smells. Negative references to airconditioning and heating systems are also near the top of the list, receiving twice as many
negative mentions as complaints related to internet issues.
hotel” is the
Burj Al Arab,
The luxury hotel opened in
1999 and was, at the time,
the tallest freestanding hotel
with its 321 meters. Using a
clever marketing strategy, it
was launched as “the world’s
first seven star hotel”. However, the true classification
is 5 Star Deluxe. The hotel
doesn’t have any ordinary
rooms but comprises 202
suites of which the smallest
measures 169 square meters
with the largest covering
780 square meters. The hotel
is one of the world’s most
expensive and a night will set
you back between 500 and
15,000 US dollars.
…the World’s oldest hotel –
has been in business for 1,300 years
Gun powder had barely been invented by the Chinese and the fall of the Roman Empire was
still in recent memory when the Japanese Spa hotel Nishiyama Onsen Keiunkan opened its
doors. The hotel is located next to hot springs in Hayakawa, Yamanashi Prefecture in Japan.
Founded in 705, it is the oldest hotel and oldest company still in operation according to the
Guinness World Records. The hotel has had 52 operators since it was founded.
Furthermore, the world’s second oldest hotel, Hoshi Ryoku, is also in Japan.
The hotel industry is the one that has
the highest proportion of young managers
The number of young managers across all industries in Sweden has decreased from 15
to 11 per cent over the past ten years according to a report from Ledarna which travelnews.
se has read.
The hotel and catering industry tops the list having the highest proportion of young managers with 21 per cent of them under the age of 35. When comparing the proportion of
young managers in Sweden to other EU-countries, however, Sweden lingers near the bottom together with Croatia, Denmark, Finland and Italy. The study also shows that the proportion of young managers has decreased more in private enterprises than public offices.
Scandic Upplands Väsby
market information from Pandox
News from the world of Pandox
A spectacular view!
New eco label at Radisson Blu Dortmund
on mini ex
The Hotel, Brussels – inspirational, elegant
The two-year period of renovation has been completed! The Hotel, on the Boulevard de Waterloo in
Brussels, can definitely be called the premium landmark hotel of the European capital from now on.
A total of 421 renovated rooms and suites,
12 completely new meeting rooms, no less than
two ball rooms, a foyer on the first floor and The
Urban Spa Fitness on the 23rd floor. ‘The Restaurant by Pierre Balthazar’ has an innovative and
creative culinary concept and there is also a bar
lounge. The interior design is inspirational,
legant and innovative.
And no matter where you are in The Hotel,
the view of the city is spectacular!
“Louis Vuitton and travel” at The Hotel.
The Hotel. wants to emphasis its elegant and
cosmo olitan character by hosting temporary
Haute Couture-themed exhibitions. “Louis Vuitton
and travel” is the first mini exhibition.
Louis Vuitton has symbolized the art of travel
since 1854, with objects that epitomize the French
art de vivre. Today, the brand is one of the worlds
leading fashion houses.
Starting next year, The Hotel, will also have
large showcases in the lobby and public areas.
A Fashion Manager has been recruited especially
to strengthen the partnership with the international
fashion world and to put in place a fashion-related
activity agenda for 2014.
Wind of changes in Hotel Berlin, Berlin
Be InnSpired at Crowne Plaza Brussels
– Le Palace
A new digital system, “InnSpire” has been implemented at Le Palace offering the latest and the
best in digital entertainment, social media and
technological advancements. Besides watching
different TV programs, the guests can also order
room service via TV, get live updates for different
activities in the hotel, enjoy internet on the TV,
post immediately on social media or synchronize
their smart phones photos with the TV etc.
New tasty popup space at Hotel BLOOM!
In Hotel Berlin, Berlin a lot has happened. A new
logo, new colours, and new designs – changes
that reflect the dynamic, modern and unique
ersonality of the hotel. Hotel Berlin, Berlin is
also very excited about their new partner, World
hotels, one of the leading global groups of independent upscale hotels.
The Radisson Blu Hotel, Dortmund has been
awarded the eco label – Green key – and is very
proud of this award.
In other news, Dieter Ulbricht (General
anager) and new chef Sven Ruhr visited the
kindergarten “Loewenzahn” in Dortmund and
served healthy food to the kids. They spent the
morning and lunch with the children who
enjoyed the visit as much as the adults did.
This beautiful showpiece is now parked inside the
OO breakfast restaurant at Hotel BLOOM! in Brussels.
By offering the waffles directly from the van, the hotel
provides the guests not only with the opportunity
to taste the famous Belgian waffles but enjoy the
total experience of eating from a traditional waffle
van, which are usually seen outside in the streets of
Brussels. Come and enjoy a tasty Liege or Brussels
style waffle with your own choice of toppings!
Playing for success
in Crowne Plaza Antwerpen
Read more news about
Pandox at www.pandox.se
Antwerp is designated as European Capital of Sports
in 2013. During the year, Crowne Plaza Antwerp hotel
has welcomed many champion sports teams, officials
and international press from all over the world. This
year, the hotel is also the proud sponsor of “UnitedAntwerp” – an umbrella sports association combining
5 major local Sports Clubs. International teams visiting Antwerp competing against the “United” teams
have been hosted by the hotel, enjoying the hotel’s
excellent gym spa as well as getting a good night’s
sleep in preparation for the next day’s competition.
Most recently, the well-known basketball Team
“MACCABI” Tel Aviv stayed at the hotel.