London hotels suffer in October
London hotels suffered their worst month in October since the Gulf War, according to preliminary figures from PKF consultants.
Occupancy dropped 23% to 66% compared to October 2000. A fall of 14% in average daily room rate to £103.30 resulted in a massive 33.4% drop in rooms yield to £68.19. The survey of 122 London hotels showed that the top end of the market suffered more than mid-market and budget hotels.
In the first full month since 11 September, different trends emerged. While the number of London hotel rooms occupied by American, Japanese, and European visitors dropped by 43.5%, 51%, and 19% respectively, occupancy by domestic visitors was down by just 3%.
Outside London, the picture was not so ugly. Occupancy fell by 4.1% to 74%, average daily room rate was down 2.5% at £64.34 producing a dip of 6.4% in rooms yield to £47.60. The top end of the market was again the major casualty among 486 regional hotels, but there were pockets of resilience. Nottingham, Cardiff and Brighton all increased their room yields.
Melvin Gold, managing director of hotel consultancy services at PKF said: "This is the second worst monthly downturn ever [for the London market], superseded only by February 1991 when the market died almost overnight. However, today's underlying economic conditions are very different to those in 1991 and we have to be hopeful that low interest rates and progress towards a resolution of the situation in Afghanistan will have a positive influence."
Across Europe there were double digit falls in occupancy. Occupancy in Paris fell below that in London to 64% but average room rate was higher in the French capital at £128.28, according to Andersen consultants.
