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End of year report: hotel rooms yield up, but occupancies down in 2012

24 January 2013 by
End of year report: hotel rooms yield up, but occupancies down in 2012

The UK hotel industry recorded as strong a year as could be expected, despite a mixed bag of results, according to PKF Hotel Consultancy Services.

While rooms yield was up 3.5% in London to £122.59, compared with 2011, and 0.5% up in the regions to £42.43, occupancy was down in both the capital (by 1.3% to 81.6%) and outside the capital (by 0.2% to 70.7%).

Room rates increased by 4.8% in London, from £143.37 to £150.23, with a rise of 0.7% in the regions from £59.61 to £60.00.

In December, hotels in the capital saw room rate fall by 1.3% to £137.01, compared with a year earlier, whilst occupancy increased by 0.7% from to 75.9%. This resulted in a rooms yield decline of 0.6% to £104.00. Regional hotels posted a 2.7% rise in room rate to £56.55 and a 0.3% drop in occupancy to 60.8%. Rooms yield consequently grew by 2.4% to £34.37.

Robert Barnard, partner for hotel consultancy services at PKF, said: "The hotel sector as a whole will be satisfied with its performance during 2012, all things considered.

"Despite high profile events such as Diamond Jubilee celebrations and the Olympic and Paralympic Games, the abiding memory of the past 12 months for many in the industry will be the absence of any meaningful recovery in consumer or business confidence. Operators in London and the regions therefore deserve credit for posting year-on-year increases in rooms yield at a time when the domestic economy has stagnated and concerns about the Eurozone have constrained demand from overseas.

"Expectations for 2013 are likely to remain modest unless we see any significant economic recovery. The lack of any meaningful new development should shield operators to some extent, but the industry is still waiting for a sustained increase in demand. As things stand, many will be relieved just to hold their own this year.

Meanwhile, according to figures produced by STR Global, London was one of only four European cities to achieve average daily increases of 10% or more (up 12% to £144.82). The other three cities were Tallinn, Estonia (up 11.5% to £55.25), Warsaw, Poland (up 10.5% to £69.92) and Reykjavik, Iceland (up 10% to £76.16).

Hotels record a mixed performance for November >>

UK hotels enjoy a strong October >>

By Janet Harmer

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