Regional hotels experienced a strong 2014, outperforming London for the first time in 14 years, according to new figures released today.
Hotel Britain 2015 – the latest annual report from business advisory and accountancy firm BDO – found that average occupancy for the regions was up 2.3% for the year, to 75.1% – the highest occupancy since since the report began in 2004.
Average room rate for the regions was up 7.7% to £60.71 compared with 2013, which helped to push rooms yield up by 10.2% to £45.60.
Regional rooms yield compound annual growth rate (CAGR) grew by 3.9% for 2010 to 2014, overtaking London for the first time since 2001 to 2005.
Meanwhile, set against a backdrop of 4% increase in supply, London hotels still maintained a respectable 82.6% average occupancy rate for the year and a 0.9% increase in average room rate to £148.42 – beating the 2008 peak of £137.47. As a result, rooms yield grew by 0.7% to £122.61.
Reflecting the strong figures, transactional activity in the hotel sector increased to £6.1bn – up 13% on 2013 and the highest figure since 2006.
Robert Barnard, partner at BDO, said: “The UK hotel sector has had a phenomenal year. Regional hotels have outperformed their London counterparts for the first time in 14 years, proving that the economic recovery is not just felt in the South East. Hotels in London have also appeared to have recovered their pre-recession performance with strong occupancy, despite an increase in supply.
“International visitors to the UK increased by 5.8% to 34.8 million in 2014, and VisitBritain predicts another bumper year ahead. Expenditure in the UK is also expected to grow to £22bn. All in all it’s clear that hotels across the UK have begun 2015 on a strong foundation.”