London hotels post strong recovery

London hotels post strong recovery

The beleagured hospitality industry has been given a boost as London hotels reported an upturn in revenue per available room in the final quarter of 2009. However regional hotels are still continuing to suffer, with revPAR dropping 7.7 percent to £44.

Deloitte, the business advisory firm, said that hotels in the capital saw revPAR increase by 5.5 percent during the last three months of 2009 to £110. However preliminary figures for 2009 overall suggested a decline of 4.8 percent in revPAR in London.

Strong occupancy rates in the capital were the key driver. These rose 5.8 percent in the final quarter to 82.9 percent, despite average room rates falling 0.2 percent to £133.

In the regions, both occupancy and room rates continued to fall - down 1.1 percent and 6.7 percent respectively.

Marvin Rust, hospitality managing partner at Deloitte, said: “Hotels in the capital have been going from strength to strength during the last three months of 2009. With sterling still weak against a basket of currencies, London seems set to continue on a fast track to recovery.”

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However he added a note of caution about the regions, saying it was “worrying” that occupancy was still falling, indicating that 2010 will continue to be tough outside the capital.

He said that real recovery is “unlikely to come before the second half of the year.”