From Shanghai to Sao Paulo:Who is Racing Ahead?

　　STR Global analysed the positive impact of the Formula One Grand Prix races on daily hotel performance between 2009 and 2011 across six host cities. During the 2011 racing calendar the World Championship saw a number of changes as Bahrain withdrew, however we also saw the arrival of New Delhi’s Buddh International Circuit for its inaugural competition from October 28th-30th. The analysis compares the 3-day event period for each year, starting with the qualifying rounds on Friday and Saturday followed by the Grand Finale on Sunday.

　　In Shanghai, the races took place from the 15th-17th April; occupancy reached 72.6% on Friday compared to 73.8% on the first day of qualifying in 2010. In 2010 occupancy climbed to 77.0% (2011, 72.1%) on the last day of the race with average daily rate (ADR) reaching CNY 1,047.04 (2011, CNY 1,165.39) Looking at the two-week window around the race, hotel performance in Shanghai typically picks up the week following the competition with both occupancy levels and rate increasing.

　　Istanbul recorded a peak in occupancy last year, on Saturday reaching 91.9%. In 2011, during the race weekend May 6th-8th, the city still experienced robust occupancy compared to the previous year, reaching 80.6% on Saturday, and ADR for Sunday increased to TRY 721.32. In addition to hosting the Formula One, May 2011 was a strong month for Istanbul with two large political summits and overall strong business activity.

　　In Singapore, occupancy increased well above last year and 2009 levels. Reaching 93.8% on Sunday, compared to 88.3% in 2010 and 89.9% in 2009. ADR began to increase from Thursday and peaked on Sunday, with ADR this year reaching SGD 549.92. In 2009 Sunday recorded, however, a lower ADR (SGD 480.51) compared to Saturday.

　　India’s inaugural race took place on the newly constructed Buddh International Circuit in Noida, 24km outside New Delhi. Occupancy reached 72.5% and 73.0% on Saturday and Sunday respectively. During the week preceding the race, occupancy was at 40.1% on Monday slowly climbing to 63.9% on Friday. ADR peaked on Sunday to INR 9,676.26 before declining again to INR 7,258.59 during the following seven days.

　　Abu Dhabi hotel occupancy achieved 86.8% on Friday compared to 92.0% during the first race in 2009. However, both Saturday and Sunday this year achieved a strong recovery with occupancy reaching 92.9% and 91.6% respectively. With a continuous growth in hotel demand, the new hotel supply has kept the ADR below the previous year, starting on Friday at AED 1,989.04 before reaching AED 1,993.20 on Saturday which recorded the highest occupancy for the weekend.

　　The last race of the year was hosted in Sao Paulo, where hotels experienced record levels of RevPAR growth compared to the race weekend last year. Occupancy reached 91.4% on the Wednesday preceding the competition and remained in the eighties throughout the weekend. ADR increased to BRL 727.21 by Sunday compared to the previous year when ADR only reached BRL 637.79 on Sunday.

　　F1 host cities benefit from an influx of F1 teams, organisers, media and spectators, and from the promotion via the worldwide TV coverage. A significant increase in RevPAR, driven mainly by ADR, across the various F1 locations can be seen in the graphs included on this article.