Hotels in the regions enjoyed a stellar March whilst those in London reported another subdued performance, according to preliminary hotel figures released today by business advisory and accountancy firm, BDO LLP [data previously compiled by PKF Accountants & business advisers, which merged with BDO LLP at the end of March 2013].
London
In London, a 4.5% drop in room rate to £122.53, compared with £128.30 in March 2012, and a 1.0% reduction in occupancy from 79.3% to 78.6% resulted in a rooms yield decline of 5.4% from £101.83 to £96.32.
Regions
In the regions, by contrast, rooms yield increased by 6.8% from £39.22 to £41.87, as a result of a 6.1% rise in room rate to £61.13, compared with £57.64 a year ago and a 0.7% improvement in occupancy from 68.0% to 68.5%.
Fifth month of regions outperforming London
Robert Barnard, partner at BDO LLP, commented: “This is the fifth consecutive month in which regional hotels have outperformed their London counterparts, which is the opposite of what we have seen for much of the past few years.
“The recent performance of regional operators is all the more impressive when you consider that these hotels tend to rely on the corporate meeting, incentives, conferences and events (MICE) market, which remains in the doldrums at the moment. The lack of any significant new developments is helping regional operators to keep downward pricing pressure at bay, with beneficial consequences on the sector’s top line.
“London has tended to defy the economic gloom in recent years but its strong run appears to have petered out since the start of the year. However, there is little evidence of any ‘Olympic hangover’ and it’s important not to get carried away: both room rate and occupancy remain high in absolute terms in the capital and the city’s fundamentals are as strong as, if not stronger than ever.”