In the Spotlight > Hotel Trends

UK hotels struggle through fourth annual decline in February

By Lorraine Heller , 24-Mar-2011

Related topics: Trends & Reports, Hotel Trends, Hotels

February has been the hardest month for business in hotels outside of London since the bout of bad weather in January last year, according to the latest data from HotStats.

GOPPAR levels fell by 12 per cent in February 2011

GOPPAR levels fell by 12 per cent in February 2011

February is traditionally a slow month for hotels, and this is the fourth consecutive year where profitability has fallen during the month in the UK’s provincial hotels.

Revenue per available room (RevPAR) grew by 0.8 per cent to £44.32 in February 2011, although gross operating profit per available room (GOPPAR) declined by more than 12 per cent. This was primarily as a result of an increase in payroll levels and a decline in total revenue per available room (TrevPAR), said TRI Consulting, which publishes the HotStats data.

“This represents the greatest margin of profitability decline for provincial hoteliers since poor weather severely impacted headline performance levels across the UK in January 2010, causing GOPPAR levels to plummet by approximately 19 per cent.”

“Having fought back from the decline in RevPAR levels since the onset of the current economic downturn, provincial hoteliers are facing a new challenge in 2011 as total revenue levels are impacted by a reduction in discretionary spend and payrolls levels remain high to accommodate the recovery in volume,” said Jonathan Langston, managing director of TRI Hospitality Consulting.

Growth in the corporate and leisure sectors resulted in a boost to average room rates in the provinces of 1.3 per cent.

London hotels

As always, the London hotel scene showed a very different picture, with profitability remaining stable in the capital’s hotels.

Room occupancy in London declined, but TRI said this is likely a sign that hoteliers have successfully managed volume in order to leverage rate and achieve RevPAR growth of 3.3 per cent to £91.39.

The real success for London hoteliers last month was their ability to maintain profitability levels against the high watermark achieved in February 2010, when GOPPAR soared by 12.4 per cent during the capital’s resurgence, said the analyst.

“It was always going to be hard for London hoteliers to equal the strong performance of 2010 and the year has begun with consecutive months of volume decline. That said, profitability levels during February have once again remained stable thanks to astute yield management,”

BigHighlights

Michael Warren on heading up Harbour Hotels, his Hotel du Vin experience and why no two days are the same in hospitality
Small talk

Michael Warren on heading up Harbour Hotels, his Hotel du Vin experience and why no two days are the same in hospitality

Michael Warren spent 17 years at Hotel du Vin and Malmaison, helping with the development and expansion...

People on the Move in Hospitality: August 2014

People on the Move in Hospitality: August 2014

We've rounded up some of the latest movers and shakers in the hospitality industry, with the past...

60-Second Skill with Nigel Haworth: finely chopped onion

60-Second Skill with Nigel Haworth: finely chopped onion

Being able to chop finely is an essential skill if you want to make sauces or stocks...

Dish Deconstucted: José Pizarro's roasted monkfish with Serrano ham, black olives and thyme

Dish Deconstucted: José Pizarro's roasted monkfish with Serrano ham, black olives and thyme

At the recent Estrella Damm Gastronomy Congress, chef and restaurateur José Pizarro revealed the method behind a dish full...

Infographic: How to handle angry customers

Infographic: How to handle angry customers

Dealing with angry customers can be one of the most difficult, stressful and challenging parts of working...

Joanne Barratt: Pearls of Wisdom
Pearls of Wisdom

Joanne Barratt: Pearls of Wisdom

QHotels’ group operations manager talks about how important a strong team culture is in maintaining excellent standards...

Find us on Facebook

Digital Edition - Restaurant Magazine

Access to the Restaurant Magazine digital edition