According to the latest HotStats Hotel Confidence Monitor, a third of hoteliers are more optimistic in comparison to Q4 2010. Looking forward, 62% of respondents were optimistic or very optimistic about future trading performance in Q1 2011. Our Confidence Monitor results revealed that London general managers are projecting an improvement in occupancy, room rate and hotel profitability whilst Provincial general managers are more cautious in their expectations.
London occupancy expectations for Q1 2011 remained positive with 63% of London general managers expecting an increase compared to Q1 2010. Whilst in the Provinces, 47% of general managers are expecting an improved occupancy performance.
Despite this, approximately a quarter of respondents are not anticipating a change in their room occupancy levels for the first three months of the year; with the remaining 28% forecasting a decline.
London average room rate and RevPAR expectations for Q1 2011 are extremely positive with 73% and 80% respectively of general managers expecting an increase, a trend reflected in the latest December Hot-Stats UK Chain Hotels Market Review. The outlook in the Provinces remains more subdued, with growth in room rate and RevPAR expected by 45% and 51% respectively of general managers.
As a result, this quarter’s gross operating profit (IBFC) expectations are higher in London than in the Provinces, with 63% of the London general managers expecting an increase. In contrast only 32% of Provincial general managers are expecting an increase whilst 38% of the provincial general managers are expecting a decrease.
The latest HotStats Hotel Confidence Monitor shows that 74% of respondents will be passing on the VAT increase to customers, of whom 53.3% of general managers in London are expecting to pass on the full increase and 26.7% intend to absorb a portion of the rate hike; provincial hoteliers intend 38.8% and 35% respectively.
Regarding this quarter’s sales and marketing expenditure, the majority of London and Provincial respondents intend to increase or maintain their Q1 budget in comparison to 2010.
Of the 267 general managers who completed the HotStats Hotel Confidence Monitor, 87% do not expect to reduce staffing levels during the next three months, a marked improvement from the last survey of 2010.