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Hotels in the UK Enjoy Record RevPAR Growth in July 2017

The middle month of summer brought only positive results for hotels in the UK. They were able to maintain their successful performance and even enjoy the growth of revenue per available room (RevPAR) of 4.4%. Thanks to an increase in all main metrics, the profit was surging as well. The growth of GOPPAR (gross operating profit per available room) estimated 3.8% - a truly fabulous result.

RevPAR set a new record in July 2017 - £105.28, which is slightly higher than the previous record of September 2016 (£103.78). This has become possible because of the growing occupancy of 0.2% to 85.3% in total. That is also a record result for hotels in the UK. Despite such a strong growth of the metrics mentioned above, TrevPAR (total revenue per available room) added only 3.0% to £153.05 because of the falling revenues from certain departments, namely, from Conference and Banqueting (-4.0%) and Food and Beverage (-1.4%). However, because of cost savings, it became possible to offset the decline in profit. Consequently, UK hotels enjoyed the highest GOPPAR of the year so far, £66.12. It’s an amazing result given that the hotel supply of the country is growing and more than 7,500 hotel rooms have been added to the market since the start of the year. 2017 has become the highest guest room addition year since 2012.

If analyzing regional markets, hotels in Bristol were among best performers in July 2017. The South West city enjoyed a surge in demand because of several events, such as the annual Harbour Festival that attracted more than 200,000 guests. Moreover, major events in Cardiff helped nearby cities due to the overflowing demand that Cardiff hotels alone couldn’t handle. With the occupancy of 84.4% and the average room rate of £93.97, Bristol hotels reached the growth of RevPAR of 7.9% to £79.31. GOPPAR added fantastic 16.9% to £46.00.

That said, RevPAR couldn’t exceed the record result of June 2017, when Bristol welcomed many visitors of The Champions League Final who couldn’t find accommodation in Cardiff. Close proximity to the Welsh capital and well-established transport connection will help Bristol hotels in future. Last month, the city benefited from Coldplay shows in Cardiff. At the same time, non-room revenues keep falling, especially the Conference and Banqueting segment (-13.9%).

Hotels in Heathrow were also among the leaders in July 2017. It was also the best single month in history as Heathrow managed to serve as many as 7.53 million passengers or 243,000 passengers every day. Naturally, hotels located in or close to the airport benefited greatly from such a load. The average room rate reached 92.9%, boosting RevPAR by 8.4% to £75.10 and TrevPAR by 6.7% to £105.12.

10.09.2017

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