Belfast and Aberdeen are proving to be among the best areas in the UK for hotel property investment, as the rest of the country prepares for a post-summer lull. The Jubilee and Olympics brought visitors en masse to Britain, but there is expected to be a significant drop in numbers, with London occupancy in 2013 predicted to be at its lowest since 2005.
PricewaterhouseCoopers (PwC) claim that occupancy in the capital will drop to 80 per cent by the end of the year, falling by nearly two percentage points since 2011. This will plummet further to 77 per cent in 2013, they claim. However, London Average Daily Rate looks set to finish 2012 at a record high of around GBP 143. This is GBP 10 higher than the same time in 2011, which was also considered a landmark rate.
Liz Hall, head of hospitality and leisure research at PwC, and author of the PwC UK hotels forecast 2013, stated: "The London hotel market has demonstrated remarkable resilience since the start of the recession. This has been helped by one-off events such as the Jubilee and 2012 Games, which have driven some highs and lows (reduced business travel) this year."
Belfast and Aberdeen have also enjoyed a positive year and have triumphed among other regional locations, with attractions such as Titanic Belfast helping to draw in visitors. According to research published in October by PKF Accountants, Aberdeen is in fact one of the few UK hotel markets that experienced an increase in revenue and occupancy rates during July this year, registering 21.3 per cent and 11.1 per cent rises respectively.
It is hoped this performance will continue into 2013,with non-London areas expected to experience only marginal occupancy decline in 2013. At the end of 2012, PwC claim that occupancy will stand at 69 per cent in regional areas, falling by one percentage point to 68 per cent next year.
However, there are still opportunities for hotel investment available in London, specifically in the high-end, boutique and branded budget hostel sectors, according to PwC. They claim that by differentiating service and offering lower rates, hoteliers can "gain market position and lure consumers away from mid-range products".
- Tuesday 13 November 2012