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New twist to Olympic room rate row

29 March 2011 by

The row over the pricing of hotel rooms during the Olympics has taken a new turn with a wholesale tour operator accusing properties of "inflating" rates.

Mario Bodini, chief executive of JacTravel, said that rates in the wholesale markets for the duration of the Olympic and Paralympic Games in 2012 were "vastly inflated and the terms of business we are being offered are so punitive that we can't risk signing contracts on that basis".

The rates he was referring to are those being quoted for rooms over and above the 56,000 rooms allocated to the London Organising Committee of the Olympic and Paralympic Games (LOCOG).

Bodini's comments come a few days after LOCOG, the British Hospitality Association (BHA) and Thomas Cook met to discuss the controversy that has arisen over the sale of hotel rooms by third parties at rates greatly in excess of those charged by the hotels.

While the hotels priced the rooms at rates based on an average of those charged between 2007 and 2010, Thomas Cook is selling them as part of packages which inflate the prices many times over.

One of the most expensive packages is for four nights, with tickets to five Olympic events, at the five-star Waldorf Hilton for £13,998.

The BHA is concerned that hoteliers have been accused of "profiteering" when they have not been involved in setting the rates offered by Thomas Cook.

"If the BHA can introduce me to its members who will offer us normal terms and wholesale rates that are calculated in line with the LOCOG formula (average of a hotel's wholesale rates between 2007 and 2010), I will contract a few thousand bed-nights immediately," Bodini said.

The BHA has responded by saying that prices being charged by London hoteliers during the Olympics - other than those allocated to LOCOG - will reflect market conditions.

"Inevitably, prices will rise if there is strong demand as a result of the Olympics but it's in no hotel's interest to outprice itself in the market," said a BHA spokesman. "In Britain's long-term interest, we urge all hotels to be cautious in their pricing policy for the Olympic Games period."

Mayor slams hotel price hike for Olympics >>

Hoteliers angry as 2012 rooms are sold on at huge mark ups >>

Hotel pricing during Olympics under discussion >>

By Janet Harmer

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