The serviced apartment sector in the United Kingdom recorded a 5.5% increase in revenue per available room (RevPAR) during the first half of 2017, mainly driven by growth in London, according to STR and the Association of Serviced Apartment Providers.
Compared with the first half of 2016, serviced apartments in the U.K. posted 1.7% growth in occupancy to an actual level of 79.2%. Meanwhile, average daily rate (ADR) increased 3.8% to GBP139.08. Rate growth for the country was fueled by a 10.3% ADR increase in London (to GBP185.58), while the capital’s occupancy rose 4.8% to 81.5%. Regional U.K. (U.K. excluding London) reported a 1.4% decline in occupancy to 76.9%, although ADR increased 1.1% to GBP90.27.
“The U.K. hotel sector experienced a tremendous first half,” said Thomas Emanuel, STR’s director of business development. “RevPAR was up 5.5% for the nation as a whole and 15.5% in London. As we’ve noted several times over the past year, the pound devaluation following last summer’s Brexit vote has resulted in a sharp uptick in leisure visitors due to a more favourable exchange rate. It is encouraging to see that the U.K.’s hospitality performance growth has extended to the serviced apartment sector, and it is quite clear that London is the driving force.”
London accounts for roughly 55% of the U.K.’s serviced apartment supply.
“After a challenging 2016, it’s good to see our sector delivering strong half-year results,” said James Foice, Chief Executive of the ASAP. “The signs are that this will continue over the summer months and into the fall and this is also borne out by our recent Sentiment Survey with Savills where operators reported that their operational performance was improving on 2016. London’s performance is particularly impressive with the strong increase in leisure business a key factor in this growth.”