November 7, 2010— Europe may be one of the most mature lodging markets in the global landscape but nevertheless opportunities for growth continue to abound, particularly for branded hotels. Traditionally a haven for independent hotels, the appetite for branded product has never been greater.

Despite significant economic troubles for the region over the past couple of years, the recovery seems to be taking hold in Europe as well with demand increases in all of the major markets of the region.

One of the biggest changes is in the year-to-date (YTD) figures for Spain's demand. In 2009, for example, Spain saw the largest decrease of the European market, with a dip of 11.5 percent. However, in YTD 2010, the country has seen the second largest increase in demand, at 8.7 percent.

Spain isn't the only country to see demand beginning to increase. While countries across the board see a rise, in particular, Italy has experienced an 8.8 percent increase, and Belgium has seen a 8.1 percent spike.

But what do all these figures mean for the brands? Brand perception is as important to the recovery as many of the economic factors, influencing who will get the travel budgets as they rebound.

Carlson, and specifically its Radisson brand, have had a huge amount of penetration in Europe through the company's Rezidor partnership. In fact, in early 2009, the company began a re-branding to bring that success into other areas of the world.

"We accepted the fact that Radisson is a two-tier brand, and we think it's important that we're honest with consumers that's what the case is," said Gordon McKinnon, chief branding officer for Carlson. "Some of the locations in the United States didn't match up with some of the overseas upscale versions abroad."

One of Starwood's nine brands, Le Meridien, got its start in Europe and serves as something of a bellwether for the company's other brands, according to Simon Turner, president, global development. "Le Meridien is an interesting brand for us. Compared to Starwood's other eight brands, which originated in the U.S., Le Meridien is the opposite. It was started in Paris in 1972 and has since spread. Its footprint has spread around the world, but in North America it is something of an import. But as a company, I think that is an example of one of our strengths—we want people with strong local expertise and a sense of the world."

In addition, after opening the W Barcelona last year, the W brand is expanding further in Europe with properties in St. Petersburg, Milan, Paris and London. Starwood's Aloft brand entered Europe this year with the opening of the Aloft Brussels in Belgium.

Europe has been a key area of growth for one of the fastest growing brands in the U.S, Courtyard by Marriott. With 40 properties in Europe, according to Janis Milham, vp, global brand manager, Courtyard by Marriott, the brand may not have a huge presence but it has performed well. "While awareness is low due to limited supply [compared to other international brands] among those who use the brand, Courtyard earns strong loyalty scores," she said.

Meanwhile, Hilton Worldwide has turned to a familiar site for growth, according to Ian Carter, the company's executive vp, operations and development. "The United Kingdom in particular is one area where we have great awareness of the Hilton Hotels & Resorts brand so that has made it easier to bring Hampton by Hilton, Hilton Garden Inn and Doubletree by Hilton there," he said.

Choice Hotels International has plans for the European market as well. "A big focus for us is growth in Europe," said David Pepper, senior vp, global development, Choice. "Because it's already a mature and established market with a lot of independent hotels, there's increasing interest in branding. Branded hotels, in fact, are becoming much more recognized. So it's a huge opportunity for Choice because there's a lot of potential conversion activity that will have an immediate impact. There also are a lot of mature hotel owners, sophisticated hotel owners, who understand the business, understand branding, and most importantly, understand how to operate hotels. They understand the Web and branding, the support services, and the technology that we can provide."

He noted that in Europe, as in other big regions such as India, U.S. hotel brands are afforded a certain amount of glamour for being "international." They are also in demand from those guests who do travel internationally, as they want the peace of mind that comes from staying at the same brand no matter what country they are in. Choice sees opportunity here, since, while they're big in some areas such as Scandinavia—where Pepper noted that Choice is the largest franchise with 30% of the market—other regions are much smaller for the company right now.

"We see the UK as a huge opportunity for us," said Pepper. "We only have 42 hotels there. Other branded hotel companies are much larger there, which shows that branding does work there and is accepted there. It'll be mostly our Comfort, Quality and Clarion brands that we're promoting there."