UK hoteliers to see their revenues rise

Hotel revenues in the UK will increase by more than 5% during both 2000 and 2001, according to a forecast from consultancy Pricewaterhouse-Coopers.

Its latest Hospitality Directions - Europe predicts that average room rates in the UK will increase by 3.6% to £76.22 during 2000, and by a further 4.4% to £79.57 during 2001.

Occupancy will edge up by 1.1 percentage points this year to hit 76.8%, and then by half a point next year to 76.7%.

The result will be 5.1% increases in revenue per available room (revpar) during both 2000 and 2001, to £58.06 and £61.01 respectively.

The predictions take into account the relationship between the hotel industry and the overall UK economy. Forecasts are that the UK's gross domestic product will rise by 3.2% in 2000, but then slow to 2.5% in 2001.

Occupancy in London is expected to grow by nearly 1.4 percentage points to 81.7% during 2000 and by a further 0.7 points in 2001 to 82.4%. This reflects the fact that while occupancy levels remain high in London, there is still room for growth if, as expected, the value of the pound falls slightly.

The average room rate in London is forecast to rise by 3.3% to £111.23 this year and by 4.2% to £115.91 next year. Revpar will increase by 5.1% to £90.86 in 2000 and by another 5.1% to £95.51 in 2001.

Growth in the UK provinces is expected to be on a par with that in London. The average room rate will rise by 3.6% to £60 this year and by 4.5% to £62.69 next year.

Occupancy will increase by one percentage point to 73.89% in 2000 and by another half a point to 74.4% in 2001.

Revpar in the provinces is set to rise by 5% to £44.34 this year and by 5.2% next year to £46.64.

• For a copy of the survey, visit www.lodgingresearch.com.

by David Shrimpton