London hotel boom continues

The London hotel boom continued throughout September; business visitors returned in force to commercial centres such as Manchester, Leeds and Liverpools; and the bands played on in Edinburgh after the Festival,  according to the preliminary figures released by PKF hotel consultancy services.London performance figures continued to break records with average daily rooms yield up more than a fifth (20.9%) on 2005 values to £108.94. This was fuelled by a 9.2% increase in room rate from £114.10 in 2005 to £124.64 and a 10.7% increase in occupancy to 87.4% this September. This good performance for the ninth month running means that London hotels’ rooms yield is now 16.5% higher than it was a year ago.
Regional performance across the 600 plus hotels in the survey revealed consistently steady growth in September with the average room rate up 3.4% to £73.22, occupancy up 1.9% to 80.8%, and daily rooms yield up 5.4% to £59.19 but, as usual, performance varied considerably across the country. With the summer holiday season largely over, visitors returned to the major business-hub cities such as Manchester, Leeds and Liverpool which recorded rooms yield increases of 12.3%, 13.0% and 5.2% respectively.
As the Festival Fringe extended into the first weekend of September, Edinburgh hotels were still 89% full and a 7.2% increase in 2005 room rates to £92.50 helped to boost rooms yield by 9.8% to £82.35.
In contrast, Cardiff room rates fell by 6.6% on 2005 to £65.48 so, although there was only a marginal drop in occupancy, rooms yield fell by 7.3% to £50.53. After a traditionally poor August, Birmingham hotels rallied slightly with the return of the business visitor but rooms yield was still more than 2% down on 2005 values.
Robert Barnard, partner for hotel consultancy services at PKF, said: “The continuing dramatic growth in the London hotel market is very heartening - although we should remember that London was still recovering from the impact of the bombings last September - and it’s clear that regional hotels are continuing to build on their solid performance to date this year.

“Providing that the economy stays reasonably buoyant to the end of the year - and barring any further terrorist scares or attacks - we can be reasonably confident that 2006 overall will go down as one of the best years ever for the hotel sector as a whole and London hotels in particular.”