Hotel performance flat in November amid economic downturn

By Peter Ruddick

- Last updated on GMT

Related tags: Room rate, Hotel

November saw London hotel occupancy fall although there was a small rise in the room rate leaving a flat performance, says PKF
November saw London hotel occupancy fall although there was a small rise in the room rate leaving a flat performance, says PKF
London hotel occupancy fell by nearly 2 per cent in November although the average daily room rate did see an increase, according to data released from hotel consultancy PKF which indicates UK hotel performance was flat last month as economic problems continued.

The latest preliminary figures for November show that occupancy in the capital's hotels dropped to 84.4 per cent from 86 per cent a year ago. That fall cancelled out the rise in the room rate for the month which saw London's average daily room rate rise by 2 per cent to £139.20.

The flat figures were matched in the data on room yield which show a tiny increase of less than 1 per cent from the same month a year ago to £117.52.

Hoteliers battling economic storms better

It has been a difficult period for London's hotels and the hotel consultancy firm claims the figures show the hotel sector is actually handling the continuing economic problems better than other economic industries.

"These figures are unlikely to bring much festive cheer to the sector. However, when viewed against a backdrop of plunging business and consumer confidence, lacklustre retail sales for much of the last quarter and the ongoing concerns about the future of the euro, these results suggest that hoteliers are battling the storms more successfully than many other parts of the economy," said PKF hotel consultancy services partner Robert Barnard.

"Looking at the positives, it is encouraging to note that London hotels have successfully managed room rates whilst maintaining occupancy at above 80%."

UK regional hotels

Hotels outside London did not suffer the same drop in occupancy with figures showing average daily room occupancy up by nearly 1 per cent in November to over 70 per cent from 69.7 per cent in the same month in 2010. However both room yield and room rate dropped in the regions with room rate for hotels outside the capital falling by more than 3 per cent in November from a year earlier to £60.85.

PKF hotel consultancy services says the economic conditions remain unlikely to improve in the near future, however Barnard said, "hotel managers appear to have learnt the lessons from 2008-9 and are much better equipped to respond effectively this time around."

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