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Results for Prague consistently gloomy
Results for Prague were consistently gloomy for the year to date, as a general lack of demand and oversupply of hotels drove the market’s key performance indicators deep into negative territory, according to data from STR Global, the leading provider of market data to the world’s hotel industry.

Foreign visitors to Prague were down 10.8 percent in the first half of the year (Source: Czech Statistical Office). The Czech Republic as a whole has seen the supply of four- and five-star hotel rooms more than double since 2000-an astonishing 118-percent increase (Source: Czech Association of Hotels and Restaurants). Recent openings in the Czech capital include the Clarion Congress hotel (559 guestrooms), the Sheraton Prague (160), the Augustine (101), the Kempinski Hybernska (75) and the Buddha Bar Hotel (39).

“The knee-jerk reaction to these two stimuli has been a dramatic decrease in rates”, explained Elizabeth Randall, managing director of STR Global, of the 17.9-percent decline in average daily rate for the year through July 2009. “The city’s hoteliers just doubled up on the pain as price cuts did not stimulate demand that wasn’t there”.

However, some improvement is on the horizon. “The slowing of the rate of decline for Prague’s year-on-year occupancy over the last few months has stalled the downward pressure on rates”, Randall said. Theodore Koumelis - Friday, September 18, 2009