London drives UK hotel recovery, says PKF report

31 March 2011 by
London drives UK hotel recovery, says PKF report

The significant recovery amongst hotels during 2010 can be largely attributed to the buoyant London market, according to Hotel Britain 2011, the guide to UK hotel performance and prospects from hotel accountants and consultants PKF (UK).

The report reviews the performance of 549 hotels, representing 92,117 rooms, across London and the regions.

Robert Barnard, hotel consultancy services partner at PFK, said that the business at London hotels improved substantially in 2010, compared with 2009, despite the ash cloud which closed most of Europe's air space for six days in April, and the extreme winter snow.

"In the first half of the year, London benefited from the weak pound, which encouraged overseas visitors to the UK and boosted a demand for accommodation in the capital," he said.

"This led to room yields increasing by 12.5% on 2009 to £119.12 - the highest they have been for the five-year period under review. And during the second half of 2010, the biennial Farnborough Air Show and a pick up in corporate and event business resulted in London positing an average of 92% occupancy for the month of July."

However, Barnard said that the picture in the regions was less rosy, largely as a result of cut-backs in business travel, which has particularly damaged the meetings, incentives, conference and events (MICE) market. He noted, though, that there were signs towards the end of the year that there was an increase in meetings and events in regional hotel.

"Countrywide, England and Scotland achieved rooms yield growth of 3.6% and 1.5% respectively while Wales was down 0.7% owing to an annual drop in occupancy of 0.7%," said Barnard.

Looking to the future, Hotel Britain 2011 predicts continued uncertainty for the UK hotel market with much depending on the outcome of wider global issues such as increasing oil prices, economic and financial scepticism, and events in the Middle East, North Africa and Japan.

"We expect London to remain stable with some anticipation of growth, especially as it benefits from the build-up to the Olympic Games, the Royal Wedding and the Champions League Final," Barnard concludes. "The recovery of the performance in the regions will, however, continue to be slow and dependent on growth in the MICE and corporate markets."

In 2010, occupancy levels across the UK increased by 2.6% year-on-year, to 74.5%. In London, occupancy for the same period rose by 1.6% to 82.6% and in the regions by 3.1% to 70.5%.

Average achieved room rate (AARR) in London rose by 10.6% to £144.14 in 2010, compared with 2009, but was down by 0.9% in the regions to £69.56.

Hotel Britain 2011 costs £300 via PKF's website at

PKF adds voice to call for reduction in hotel and tourism VAT >>

London hotels taking different route to recovery >>

TRI Hospitality Consulting makes positive forecasts for 2010 >>

By Janet Harmer

E-mail your comments to Janet Harmer here.

If you have something to say on this story or anything else join the debate at Table Talk - Caterer's new networking forum. Go to jobs

Looking for a new job? Find your next job here with jobs

[Newsletters For the latest hospitality news, sign up for our e-mail newsletters.
TagsTrends and Hotels
The Caterer Breakfast Briefing Email

Start the working day with The Caterer’s free breakfast briefing email

Sign Up and manage your preferences below

Check mark icon
Thank you

You have successfully signed up for the Caterer Breakfast Briefing Email and will hear from us soon!

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.


Ad Blocker detected

We have noticed you are using an adblocker and – although we support freedom of choice – we would like to ask you to enable ads on our site. They are an important revenue source which supports free access of our website's content, especially during the COVID-19 crisis.

trade tracker pixel tracking