London hotels recorded the 14th consecutive month of average daily rate (ADR) growth in December, according to preliminary figures from data company STR.
However, the ongoing increase in bedroom supply, up 3.1% last month, resulted in a 2.7% year on year dip in occupancy to 77.9%.
As a result, while ADR increased by 0.4% to £148.85m, revenue per available room dropped 2.3% to £115.99.
Demand remained virtually flat, with an increase of just 0.3%.
STR analysts said that the "Brexit effect", which drove a surge of overseas visitors to the UK in early 2017, appears to be wearing off as the value of the pound continues to climb.
STR will publish the full December figures, together with the total 2017 results, later this month.
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