During the first three months of 2017, the hotel industry in London posted its highest revenue per available room (revpar) for any first quarter on record.
That is according to research from data company STR. The market's revpar level of £101.50 was an 11.3% increase compared with Q1 2016. Occupancy reached 76.1% (+4.8%), the highest Q1 value since 2010, and average daily rate (ADR) reached a record level at £133.38 (+6.2%).
STR analysts attribute the strong performance to a 7.7% spike in demand, likely driven by the devaluation of the pound. Additionally, the Easter calendar shift from March 2016 to April 2017 moved more demand into Q1. Overall, demand was up 8.8% in March, and revpar rose 14.2%.
Performance increases were seen across all London submarkets, with the highest levels in the West End, Earls Court/Kensington/Chelsea and South Central London. Performance growth was highest for the upper upscale segment with a revpar increase of 14%.
STR analysts see performance figures for UK areas excluding London as a sign that the rest of the country also is benefiting from the increase in leisure visitors due to the pound devaluation. Revpar for regional UK was up 3.8% to £44.70 for Q1.
James Parsons, head of business development for STR, said: "After the struggles of early 2016, we've seen consistent performance growth in London. What remains to be seen is how the market will react to an influx of new supply set to come online in the near future."
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