Occupancy rates increased again for London hotel in May on the back of the attractiveness of cheap Sterling and improved economic outlook. However regional hotels continued to struggle, according to monthly figures released today by PKF Hotel Consultancy Services.

Occupancy across London’s hotels increased 1.3% year on year in May, from 81.0% last year to 82.1% this year. Room rate did not do so well, dropping 7.3% to £116.49, as hoteliers looked for ways to attract visitors. As a result, rooms yield fell by 6.4% from £101.77 last year to £95.59 this year.
In the regions, occupancy was down 5.6% on the same period last year from 74.2% to 70.1%. Room rate also continued in a downward spiral from £76.93 in 2008 to £69.75 in 2009. Overall, rooms yield was down 14.4%.

Cardiff was one of the worst hit regional cities, posting a 25.1% drop in rooms yield from £62.62 last year to £50.02 in 2009. Equally, Liverpool and Manchester had a difficult month. Liverpool’s figures are slightly skewed because last year was such a strong year for the city as European Capital of Culture, but nonetheless, the economic downturn will be playing its part.

Manchester also benefitted from Liverpool’s status last year and Manchester’s rooms yield is down 15.2% year to date. Occupancy is down 6.0% and room rate is down 9.8%.

Robert Barnard, partner for Hotel Consultancy Services at PKF, commented, “The story continues in May on a similar vein to April. London’s year round appeal means that visitors continue to stay in the capital’s hotels, pushing up occupancy figures. The economic climate means that hoteliers are having to reduce their rates in order to attract the visitors however and overall this is affecting rooms yield.

“The regional story is a different one with the cities losing in the downturn on both an occupancy and rate front. However, places like Edinburgh have proved to be an exception to this rule, as the city, like London, again managed to increase occupancy levels.

“With the Summer holiday season beginning, hopefully we may also see some better regional results if families, as predicted, do indeed choose to holiday in the UK this year.”

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