The survey also shows that for the twelfth year running Moscow remains the most expensive city for business travel, with a 6.07% increase (GBP) in ARR compared to last year. The findings from the latest HRG Interim Hotel Survey also reported that 31 of the top cities experienced an increase in ARR with only 15 cities falling and five remaining static. Key findings - With 12 years in the top spot, Moscow has benefitted from a modest growth in GBP translating into a huge growth locally, due to extreme movements in the exchange rate - Mega cities continue to dominate; cities within a region continue to see a large disparity in terms of ARR movement, showing once again that regional performance is diminishing compared to mega city performance - This is again witnessed by the regional charts from the survey with only the Americas showing ARR growth (9.89%). MEWA has seen a dramatic decrease with ARR down by 19.47%. This is caused not only by the ongoing mega city trend but also by more supply in key cities together with a stalling of key feeder markets such as Russia - The full effects of the slowdown in the oil industry can be witnessed in both Aberdeen and Houston. For the first time in many years hotels in both cities are having to significantly discount room rates to maintain demand - Convention business continues to have a positive impact on ARR, with Berlin, Boston, Chicago, Frankfurt and San Francisco all posting increases in ARR as a result - Both Chennai and Tokyo have enjoyed an increase in corporate demand resulting in rises of 20.9% and 7% respectively - Oversupply remains an issue on ARR in Abu Dhabi, Dubai (although to a lesser degree as the city is readying itself for Expo 2020) and Rome - Geneva has dropped one place from third to fourth due in part to the removal of the Swiss Franc cap. This is making travel more expensive and so demand is slowing. Corporates are down trading into mid market hotels - Mumbai – India’s financial and entertainment capital – has seen an increase in corporate demand, resulting in a modest increase in ARR. With India forecast to overtake China this year in terms of economic growth, Mumbai along with India’s key cities will be ones to watch this year and next - Influencers on changes in ARR continue to include oversupply, exchange rate movements, economic and political sanctions The HRG View: Margaret Bowler, Director Global Hotel Relations: “Our interim hotel survey is a real barometer for economic growth. We have booked more hotel room nights than last year, illustrating an increase in the number of corporates travelling to do business. It’s been an interesting half year for the hotel business.” “Markets globally are becoming even more fragmented and accommodating not only the ongoing stature of the mega city in the face of the diminishing importance of the region, but also different city trends within the same city. This in-city fragmentation is well illustrated if we look at New York. The Times Square area is seeing a lot of new bed stock which has resulted in a stagnation of ARR whereas in other parts of the city, we continue to see ARR rising. Clearly this can benefit the corporate client who has flexibility to enable their travellers to book in these city areas and benefit from the lower room rates.” “Flexibility is going to remain a key differentiator for hotel programmes moving forward. Not only in terms of being able to benefit from in-city fragmentation as detailed previously but also in terms of the increase in new bed stock in defined tiers - budget/mid-market limited service, mid-market full service etc. This gives the client greater, wider and deeper choice. With new brands and concepts appearing almost daily, we are seeing many legacy hotel chains fighting for the traditional mid-market.” “The flexible and canny client can really maximise the results of the interim hotel survey to realise even greater savings on their hotel programmes.” Download the report at HRG (PDF 1.3 MB)