Hotels in London recorded an increase in room yield by almost 50 per cent last month as a result of year-on-year room rates rocketing up from £110.22 to £165.05 a night, with occupancy levels remaining above 80 per cent for the entire period of the London 2012 Olympic and Paralympic Games.
According to preliminary figures released this week by PKF Hotel Consultancy Services, average room yield for properties in the capital was £135.35, up from £91.12 in August 2011. In the regions, room rates rose by 5.7 per cent from £59.22 to £62.61 and occupancy fell by 2.4 per cent to 75.6 per cent, compared with 77.4 per cent this time last year. Rooms yield consequently improved by 3.2 per cent from £45.87 to £47.35.
“In over 30 years in the industry, I can’t recall ever seeing a year-on-year increase in rooms yield of almost 50 per cent so it’s fair to say that it will have exceeded expectations,” said Robert Barnard, partner for hotel & hospitality consultancy services at PKF.
“The results show that, after a lacklustre July, hotels across the country were eventually able to make the most of one of the most highly regarded sporting events in living memory. That said, the numbers are somewhat exaggerated by the fact that London hotels normally discount rates in August whilst the corporate market takes a break.
“Meanwhile, outside of the capital, there are indications that the continued popularity of ‘staycations’ has given hoteliers a much-needed fillip in an otherwise still stagnant market.
“It will be interesting to see what legacy the Games leave for the UK hotel sector over the coming months. Previous host cities have reported a post-event hangover but London may yet prove to be more resilient as it has long since been considered a global destination in its own right and didn’t need the Olympics to put it on the map.”
Meanwhile, this month’s Trivago Hotel Price Index has revealed thatprices in London and Edinburgh have decreased by 11 per cent and 33 per cent respectively in September compared with August.
With the end of the London 2012 Olympic and Paralympic Games and the Edinburgh Fringe Festival, an overnight stay in London will now cost an average of £162 and one night in Edinburgh will cost £119. These prices are just 2 per cent (in London) and 3 per cent (in Edinburgh) higher than this time last year, showing that prices in these two cities have now returned to normal levels.