The Olympic Games were a catalyst for London posting a huge gross operating profit per available room (GOPPAR) increase of 90.1 per cent in the month of August, according to the latest HotStats survey by TRI Hospitality Consulting (TRI).
The capital also saw a 173.7 per cent increase in conference and banqueting room hire revenue, with many London hotels hosting large Olympic corporate–related events.
Average room rate increased by 40.6 per cent from £106.87 to £150.28, underpinning a 41 per cent increase in revenue per available room (RevPAR), whilst total revenue per available room (TRevPAR) increased by 39.8 per cent.
Jonathan Langston, TRI’s managing director, said: “With the Olympics, August was an extraordinary boost for the London hotel market on the back of a decline in June and July GOPPAR performance. Put into context, the RevPAR and GOPPAR growth rate recorded this month is the highest we have seen since HotStats began for the London full-service hotel market.”
Analysis of non-rooms departmental revenue performance also showed that London full-service hotels achieved a significant increase of 15.1 per cent in food revenue and 19.8 per cent in beverage revenue.
For 12-month average figures up to July, TRevPAR was up only 0.8 per cent, while GOPPAR was down 0.3 per cent, but the Olympic Games were responsible for a notable boost for the 12 months before August, with an increase in total revenue of 3.4 per cent and an increase in gross operating profit of 4.6 per cent.
“Whilst London market-wide performance in August performance was exceptional, we cannot avoid the fact that there has been a slow-down in revenue and profit growth prior to the Olympics. Factors such as a stable exchange rate, increasing hotel supply pre- and post-Olympics and challenging market conditions in the UK and wider global economy is likely to temper TRevPAR and GOPPAR growth in London over the next year,” added Langston.
Pictured: Jonathan Langston