Royal Wedding boost for hotels was lower than expected

By Lorraine Heller

- Last updated on GMT

Related tags: Royal wedding, Hotel

High room rates may have deterred hotel guests over the Royal Wedding weekend
High room rates may have deterred hotel guests over the Royal Wedding weekend
Hotels in London posted strong results for April, but the contribution from the Royal Wedding was far lower than expected, according to new data from TRI Hospitality.

Although some half million visitors were estimated to have arrived in London to celebrate the marriage of Prince William and Kate Middleton, many of these may have been day-trippers, as hotel occupancy for the day was only 60 per cent, said the analyst.

“It was widely anticipated that the Royal Wedding would cause a significant boost to headline performance levels for London hoteliers in April. However, whether it was due to high pricing in the full-service market or a higher than forecast proportion of day trippers, it is clear that the expected demand did not materialise,” said Jonathan Langston, managing director, TRI Hospitality Consulting.

Based on a survey of 550 UK, hotels TRI’s latest HotStats survey found that profit per room in London hotels grew by 12.5 per cent to £57.01 in April, although week results from both the Royal Wedding and Easter held back the month’s overall performance. Occupancy on Easter Monday was just 46 per cent, down 26 per cent compared to last year.

The sector’s strong April results were attributed to good year-on-year performance levels at the beginning of the month as well as a recovery from the declines in occupancy and average room rate suffered in April 2010 as a result of the ash cloud.

Overall, the increases in volume and price, together with increases in food and beverage revenue, contributed to a 10.3 per cent increase in total revenue per available room (TrevPAR).

Provincial hotels stung by holidays

Moving to the provinces, the string of April bank holidays resulted in a 5.2 per cent decline in gross operating profit per available room (GOPPAR). This was primarily a result of the dip in corporate demand, said TRI.

“A significant number of key Provincial hotel markets rely heavily on commercial activity to drive demand for accommodation and the timing of these bank holidays has only further exacerbated the tough trading conditions for Provincial hoteliers,” said Langston.

“Our hope would be for hotels in the Provinces to have a strong operating period in May and June before the summer holidays begin in earnest.”

Related topics: Hotels, Hotel Trends, Trends & Reports

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3 comments

Rate Setting

Posted by Graham Perch (Customer Service Trainer),

I wonder if anyone has completed a survey on 'what the cost of not rate setting for special events would be', would there be a cost/loss? How do accommodation providers that don't increase rates during events fair in comparison to those that do increase rates? Do the long term benefits of not rate setting off-set rate setting? I have often stayed for 1 night but had the rates been 'normal' rather than inflated I would have stayed for 2 or perhaps 3 nights during special events.

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Follows the same pattern

Posted by Innkeeper,

I was Running hotels in London when Charles and Dianan married Same very poor show. Rate setting was ridiculous, so you reap what you sew London, don't get too excited about the olympics!!!!!!

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Why we didn't stay in hotel

Posted by Julia de Cicati,

The rates were ridiculous and finding an apartment for 2 weeks was so much cheaper, especially when you'd be camping on the street at least one night. I'm sure many people were put off by rate jump during that week as I was.

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