UK chain hotels set for slowdown

A new report on the fortunes of UK chain hotels predicts the sector is heading for a slowdown.

In its latest annual HotStats report, TRI Hospitality Consulting warns the sector's strong growth can't realistically be sustained at the same high level.

Instead, the consultancy has predicted revenue per available room (revpar) will increase overall by 4% this year, and be pegged back at 1.2% in 2006.

Revpar growth at London hotels should be 5.7% this year, dropping to 2.3% in 2006.

But regional hotels are likely to suffer from increasingly fragile consumer confidence, and TRI has predicted revpar growth will be 3% this year, and just 0.6% next.

The report also revealed that the profitability of the UK hotel sector had rebounded strongly in 2004, with gross operating profit increasing by 8.4% to £10,960 per available room.

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