90% of global markets post RevPAR growth above 2019, most of China included

Analysis by Eddie Yeung

STR's global "bubble chart" update (as of 15 July 2023) shows an exceptional 90% of markets with growth in revenue per available room (RevPAR) compared to 2019. This marks the highest proportion of markets in that category since the update began in May 2022.

China played a significant role in that growth with 85% of its markets surpassing 2019 RevPAR levels. At one point last year, China accounted for one-fourth of the markets with RevPAR levels below those of 2019.

Among all countries with a total supply of more than 50,000 rooms, Israel, Switzerland, Greece, Italy, and France led in RevPAR on an actual basis. Notably, all five countries were leaders in the last 28-day period, but this time around, Greece grabbed the top spot from Israel.

Since the last update, country-level performance has remained stable, with all 48 countries in the 50,000-room group reporting occupancy rates above 50%. Ireland continued to lead in occupancy at an impressive 88%. Additionally, as the northern hemisphere moves deeper into summer, average daily rate (ADR) has been on the rise with nine countries reporting ADR above US$250.

The leaders in absolute RevPAR performance also led the way in RevPAR growth compared to 2019. Greece, Italy, and Israel retained the top spots and were joined by Saudi Arabia and Colombia. Notably, Saudi Arabia moved from the lower ranks to become one of the top performers once again, primarily because of the seasonal adjustment of Ramadan.

It is worth highlighting that the largest non-north America market, China, has seen significant improvement in its performance since the beginning of this update. The country reached its 2019 occupancy level recently, while growth in ADR was somewhat low at 9%. 

Overall, occupancy growth retracted compared to the last review, as only nine of 48 countries experienced higher levels than in 2019—12 less than in the previous update. Indeed, three of the top five RevPAR leaders couldn't capture growth in this indicator, as Italy, Greece, and Israel all saw their occupancy levels fall behind those of 2019.

Excluding markets with fluctuating exchange rates, the top five RevPAR performers were the Italian Central region, Sri Lanka, Basilicata/Calabria/Puglia, Hainan, and Sanya. Notably, the two summer holiday destinations in China, Hainan and Sanya, saw exceptional growth in RevPAR, with Hainan recording an impressive 157% increase, while Sanya's RevPAR grew 119%.

The 90% of markets now surpassing their 2019 RevPAR levels was up five percentage points compared to the last update (85%). Despite these positive signs in RevPAR, occupancy rates continue to fluctuate, with only 40% of markets surpassing 2019 levels. The figure was down from 52% in the last update.