Budget brands to dominate UK hotel development over the next three years

By Sophie Witts contact

- Last updated on GMT

Budget concepts such as hub by Premier Inn are driving hotel growth
Budget concepts such as hub by Premier Inn are driving hotel growth

Related tags: Hotel

Budget brands will make up 47 per cent of new hotel developments over the next three years, according to BDO’s latest Hotel Britain report.

The study cited the diversifying of the budget hotel market, including development of new concepts by Citizen M, hub by Premier Inn​, Tune and the Qbic Hotels as driving growth.

It also noted that ‘major modernisation’ at Travelodge and Whitbread had been successful, with a ‘strong development pipeline’ in place at the top companies. In 2015 alone Travelodge plans to open 15 hotels and has identified potential for an additional 250 sites​, while Whitbread have around 28 hotels currently under construction.

Expected development trends

The report indicated a slowing of development activity in the midmarket (three star) segment. Though one-third of current sites are in this bracket, only four per cent of the openings in the next three years are expected to be in this category.

Both five star and apart-hotels are experiencing good development activity. While they currently occupy four and three per cent of the overall market respectively, the sectors are expected to grow by 13 and 10 per cent.

Four star hotels, which make up 29 per cent of the market, will maintain a strong market presence and are predicted to grow by 26 per cent.

“International visitors to the UK increased by 5.8 per cent to 34.8m in 2014, and VisitBritain predicts another bumper year ahead. Expenditure in the UK is also expected to grow to £22bn. All in all it’s clear that hotels across the UK have begun 2015 on a strong foundation,” said Robert Barnard, partner at BDO.

Related topics: Hotels, Trends & Reports, Venues, Business

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