By Daniel Hunter
Hotels in the regions enjoyed a stellar March whilst those in London reported another subdued performance, according to preliminary hotel figures released by business advisory and accountancy firm, BDO LLP.
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.
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%.
“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," Robert Barnard, partner at BDO LLP, commented.
“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.”
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