The London hotel market enjoyed stability in June, thanks to successful revenue management. Preliminary figures from business advisory and accountancy firm BDO LLP showed the capital's hotels outperformed their regional counterparts for only the second time this year last month. While there was a two per cent year-on-year drop in room rate to GBP 143.79 from GBP 146.75 in June 2012, this was offset by a 6.3 per cent increase in occupancy from 82. 6 per cent to 87.9 per cent.
For London hoteliers, this created a 4.2 per cent rise in room yields from GBP 121.33 to GBP 126.36. Robert Barnard, partner at BDO LLP, explained this is thanks to operators "skillfully using selective price discounting to contribute to top line growth at a time when the operating environment is beginning to show signs of improvement".
However, performance is still strong in the country's regional markets. In June room rates remained unchanged at GBP 62.77, while occupancy increased by 2.4 per cent from 74.9 per cent to 76.8 per cent. This led to year-in-year growth in room yields, from GBP 47.07 in June 2012 to GBP 48.21 in 2013 - a rise of 2.4 per cent.
Mr Barnard said: "Regional hotels will be particularly pleased with their results for the first half of the year. A combination of strong management and lack of new hotel openings has enabled operators in the regions to buck the trend we’ve seen in recent years and outperform their London counterparts. To have achieved this at a time when the MICE (meetings, incentives, conferences and exhibitions) market remains in the doldrums is all the more impressive."
Going forward, BDO LLP expects regional hotels to remain in the black as long as consumer and business confidence continues to increase. London may also fall below last year's performance, due to the distortion of the 2012 Olympics. However, Mr Barnard claims the city remains in a strong position for the remainder of 2013 thanks to pleasing fundamentals.
- Tuesday 23 July 2013