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Hotels in UK Feature Flat Occupancy, but Rising ADR

Even though the majority of news tells us about the recovery of the hotel market in the UK, the situation is not the same elsewhere. While hotels in London do have improving results and their profits grow, accommodations in provincial full-service hotels have flat occupancy and, thus, the decrease in profit.

London-based TRI Hospitality mentions currently provincial hoteliers face multiple complications and challenging situations. This leads to no revenue increase despite positive forecasts. Among the complications named by TRI are the rise of VAT and inflation. By the end of the year TRI forecasts no improvements in occupancy.

Nowadays both business and leisure travellers are on budget, making them savvier about each pound spent. This only increases competition between the hoteliers in provincial UK cities, particularly in the midmarket segment. Because of this situation gross operating profit by the end of the year may even decrease. At least, according to TRI it may decrease up to 4%.

Meanwhile London hotels will improve their figures thanks to leisure and commercial tourists. Here TRI forecasts a growth of 3.4% in ADR and more or less stable occupancy. In case current trend concerning the rise in business tourism will be maintained throughout the year, London hotels can expect the growth in RevPAR of 3%.

The influx of tourists to London is increased mostly by visitors from BRIC countries (Brazil, Russia, India, and China). European and American tourists tend to seek other locations for rest due to the strength of pound.

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