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UK hotel rates fall for second time in three months

In May UK hotels saw a 0.9 per cent drop in average room rate to £116, according to HotStats

Pictured: The Tour de Yorkshire helped Leeds hotels buck the national trend

UK hotel rates have fallen for the second time in three months, according to the latest worldwide poll of full-service hotels from HotStats.

In May UK hotels saw an uncharacteristic drop in achieved average room rate, which fell by 0.9 per cent, to £116. This is only the second time since October 2016 that a decline in rate has been recorded, as the ability to leverage price has been a mainstay for UK hoteliers on the back of punchy room occupancy levels. The first drop was during the debilitating weather conditions in March 2018.

The falls came in spite of the spike in leisure-related demand generated by the two Bank Holiday weekends and a range of events including the Royal Wedding.

“As this is only the second time there has been a decline in TrevPAR in the last 20 months, it is probably more of a blip in performance than a sea of change,” said Pablo Alonso, CEO of HotStats.

“However, with an additional six days of school holidays due to the two Bank Holiday weekends and May half-term, the UK hotel market was undoubtedly more reliant on the leisure sector this month, which has not performed.

“Whilst both London Heathrow and London Gatwick airports reported handling record passenger numbers in May, it is possible that the poor weather earlier in the year led to there being a higher number of departures than arrivals.”

In contrast to the overall performance of hotels across the UK, properties in Leeds recorded one of their strongest months of year-on-year growth in recent years this month as the city hosted the final stage of the Tour de Yorkshire.

Room occupancy at hotels in Leeds soared by 6.5 per cent year-on-year to 79 per cent, which was accompanied by a 1.5 per cent increase in achieved average room rate to £81.

“The Tour de Yorkshire is a spin off event which was created after the region successfully hosted the Grand Depart for the 2014 Tour de France. The number of spectators to the event now exceeds more than two million people which not only positively impacts the local economy, but is a coup for hoteliers on the route,” said Alonso.

Hotel performance in Manchester was much more subdued, with declines recorded in both room occupancy (2.8 per cent) and achieved average room rate (1.4 per cent).

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