The UK

BRITAIN'S hotel groups agree that the sector is emerging from recession, albeit patchily. The meetings and training markets are increasingly healthy and there are signs of increased activity in weekend breaks.

But recovery in the corporate travel and business entertaining segment is inconsistent and fragile. Lead-times for group bookings are shorter than ever; corporate clients are learning to drive a hard bargain and are more exacting about their requirements.

These observations come from companies participating in the Caterer & Hotelkeeper Top 50 Hotel Groups Survey.

In London the mood is optimistic. Four Seasons-Regent, which has two hotels in London, reports "a definite upward trend and much improved occupancy", with average room rates stable.

But that is definitely a London view. Provincial hotels are seeing improved occupancy but no significant increase in average achieved room rates (AARR).

ITT Sheraton confirms that lead times for group bookings are shorter. Scottish Highland Hotels agrees that the lead-in period to bookings has reduced still further, but expects to see that position reversed by the end of the summer.

Stakis reports a slight improvement in corporate rates, and increased competition in the leisure market.

Paul Dermody, deputy chairman of Greenalls Group's Hotels and Branded Restaurants division, reports that conference buyers are becoming increasingly demanding. "They are no longer satisfied with mediocre meeting facilities but require the latest state-of-the-art technology," he says.

Richard Arman, vice-president of development and franchise services at Choice Hotels International, says a key trend is an increasing demand for "value-oriented" conferences. "Hotels which can tailor a complete package at prices which are more synonymous with the mid-market sector are the ones which will show incremental business growth," he predicts.

On the leisure side, Arman is looking to the post-war baby boomers, now approaching 50, a group for whom Choice launched a European marketing programme last year.

In the UK, the number of over-50s will increase by 9% during the 1990s, compared with a total population growth of 3%.

The corporate travel market, says Periquito, is still comparatively weak, but managing director Peter Mackworth Gee confirms improvement in the meetings market.

In the corporate sector, boardrooms may be making more of the decisions on where executives stay. Swallow Hotels sales and marketing director Neal Crocker comments that company policies are an important influence on individual business travellers, and that agents are also influencing decisions. Inter-Continental says large corporations are featuring fewer hotels on their lists of preferred properties and are making the use of these mandatory.

Improvement in the conference and meetings segment applies in Northern Ireland as in the rest of the UK. Hastings Hotels says increasing confidence in the province is improving both tourism and business travel.

Of the 100-plus companies mailed for information for this survey, just 31 provided some information on occupancy, achieved room rates, turnover and profit figures. Full details will appear in Caterer's Hospitality GB annual report later in the year, but here are some brief findings:

Radisson Edwardian reports the highest year-round occupancy, at 86%. Other companies reporting 70% or better are Sarova Hotels, Granada Hospitality, Channel Hotels & Leisure, European Country Hotels, Scottish Highland Hotels, ITT Sheraton UK and Port Erin Hotels.

The Savoy Group and Four Seasons-Regent are way ahead on AARR, with £185 and £159.55 respectively. Other companies reporting AARR of £50 or more are ITT Sheraton UK, European Country Hotels, Shire Inns, Scott's Hotels (the Marriott franchisee) and Channel Hotels & Leisure.

ITT Sheraton emerges as the most profitable group, converting 30.68% of its turnover into operating profit. Other groups with an operating margin of 20% or better are Croft Hotels, Hilton International, Stakis, Arthur Young Hotels and Friendly Hotels.

Peter Chester, who recently took over as marketing director at Principal Hotels, sees an opportunity as a result of the way the UK hotel industry has polarised in the 1980s and early 1990s. Led by the established hotel groups, many two-star and three-star hotels have been upgraded. At the same time, motorway lodges have been creating a new minimum-service market. In between, says Chester, is scope for "really well run provincial hotels offering exceptional comfort and value".

Whitbread reflects Chester's view of the market. Its renamed Country Club Hotel Group includes Country Club Resorts (the former CCH properties), with golf courses and other leisure facilities; and in the lodge segment, Travel Inn is developing two units a month, to challenge the lead established by Forte Travelodge.

The lodge segment is essentially supposed to be "no frills". But as it becomes more competitive, operators are adding extras to woo others' customers away. Pavilion Lodge is planning to offer improved telephone and fax systems for its business guests. Forte Travelodge initially launched without in-room telephones, because of the difficulty of charging for calls - guests pay as they check in - but has since developed a special pay phone.

Granada, too, wants to introduce a premium element to the budget lodge market, and is now offering telephones and Sky TV in all rooms.

Ramada, which has gained and lost hotels since it first started developing in the UK, acquired both of Penta's UK hotels - at Gatwick and Heathrow Airports - last year. Now it plans to develop a new 200-room Ramada in London's Maida Vale.

Holiday Inn, perhaps the world's most successful hotel brand name, is being exploited even further with more brand extensions in Europe. Nice, on the French Riviera, now has a Holiday Inn Resort, and the new economy brand, Holiday Inn Express, has been launched in Germany. Contracts have been signed to develop 20 Holiday Inn Express Hotels in Poland.

Hilton National, the UK-only middle-market division of Hilton International, has appointed a new managing director, John Bamsey, who has embarked on market research as part of a brand review. The company hints that brand repositioning is a possibility. o