Following a decline in profitability in August, hoteliers in London bounced back in September, according to the latest HotStats survey.
There was a 10.4 per cent increase in profit per room for hotels in the capital last month. At £85.64, this was approximately 24 per cent above the year-to-date average and around 14 per cent above the pre-recession high of £74.84, achieved in September 2007.
“Three years on from the collapse of Lehman Brothers, the increase in headline performance levels this month is further evidence, if it was needed, that hoteliers in the capital have put the memory of the crash in the hotel market in September 2008 firmly behind them,” said Jonathan Langston, managing director of TRI Hospitality Consulting, which compiles the monthly HotStats survey of 550 full-service hotels across the UK.
Revenue per Available Room (RevPAR) benefited from a year-on-year increase of 8.8 per cent to £122.71. Langston said RevPAR growth in the capital was driven by a return to strong rate increases, which were largely achieved in the corporate and residential conference sectors. Average room rates paid by corporates rose by 14.6 per cent to £158.06, while those paid by residential conferences increased by 16 per cent to £164.92.
Looking at provincial cities, Birmingham and Liverpool recorded contrasting performances in September despite both hosting major party political conferences – Birmingham hosted 8,000 delegates for the Liberal Democrats and Liverpool hosted around 11,000 for the Labour Party Conference.
Hotels in Birmingham saw a RevPAR increase of 4.3 per cent, which was led by a 3.9 per cent increase in average room rate to £78.56. In contrast, hotels failed to feel the benefit of the Labour Party Conference in Liverpool, as hoteliers suffered a 16.7 per cent decline in profit per room to £28.51.
Overall, hotels in the UK once again achieved a positive RevPAR result (+1.9 per cent) but this was negated by rising costs, which left profit per room 2 per cent behind the same period in 2010 at £36.