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UK hotels stutter in June as economic concerns and rain hit occupancy

19 July 2012 by
UK hotels stutter in June as economic concerns and rain hit occupancy

Hotels across the UK experienced a tough June, with a sharp decline in occupancy, according to figures released today by PKF Hotel Consultancy Services.

In London hotels, occupancy fell by more than eight percentage points to 82%, compared with 90.1% in June 2011, while room rate increased by 2.2% from £163.40 to £166.96. This resulted in a 7.1% year-on-year reduction in rooms yield from £147.28 this time last year to £136.87.

Meanwhile, hotels in the regions experienced a 2.3 percentage-point decrease in occupancy from 78.3% to 76%, which more than offset a 1% rise in room rate from £61.02 to £61.64, leading to a 2% drop in rooms yield to £46.82, compared with £47.78 a year ago.

Robert Barnard, partner for hotel consultancy services at PKF, said: "Although we've seen noticeable falls in occupancy across the country in June, it's important to keep these results in context - occupancy remains high in absolute terms, with London hotels continuing to sell well over 80% of their available rooms during the month.

"A lack of confidence in the domestic economy and the Eurozone's ongoing problems - which intensified in June with the uncertainty surrounding Greece's continued participation in the single currency and the Spanish banking bailout - will have undoubtedly contributed to these results. Europe accounts for as much as 75% of our overseas visitors, so the UK hotel sector will be hit if businesses and individuals in struggling EU countries cut back on their spending. The record rainfall that the country experienced last month will not have helped, either.

"The impact of the extended Diamond Jubilee bank holiday at the start of the month appears to have been insufficient to hold back the economic headwinds. Hotel operators throughout the UK will be hoping that the Olympics and Paralympics will have a more significant effect."

UK hotels post mixed results for May >>

Strong results for London and regional hotels in April >>

By Janet Harmer

E-mail your comments to Janet Harmer here.

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