HotStats UK Chain Hotels Market Review – August 2015

Lack of Summer Sun Fails to Dull Spirits of North West Hoteliers

Hotels in the North West sizzled this August despite the soggy summer, recording a 5.2% increase in Revenue per Available Room (RevPAR), to £56.69, which contributed to a 3.8% increase in Total Revenue per Available Room (TrevPAR), to £101.43, according to the latest data from HotStats.

As a result of the growth in popularity of key North West cities as destinations for leisure visitors, including Liverpool and Manchester, as well as astute revenue management by hoteliers, unlike the British weather the month of August is no longer a wash out, with room occupancy at hotels in the region this month recorded at 79.7%, one of the strongest monthly occupancies in the year to date.

The 6.3% year-on-year increase in GOPPAR achieved by hotels in the North West was well ahead of the rest of the UK in August, which managed a 5.4% increase in GOPPAR as a result of a 3.7% increase in RevPAR.

Manchester was one of the big winners in the region, recording a 12.5% increase in GOP to £26.85 per available room, which was driven by a 6.8% increase in TrevPAR, combined with cost savings made in both payroll (-3.0%) and overheads (-2.0%).

Festival Fever Boosts Bottom Line at Edinburgh Hotels

August is always a peak month of performance for hotels in Edinburgh and 2015 was no exception with RevPAR achieving an impressive 6.3% year-on-year increase to £139.61 from £131.35 during the same period in 2014, which was in spite of a 0.8 percentage point decline in room occupancy, to 92.3%.

As a result of this growth, at £139.61 RevPAR recorded at hotels in Edinburgh for the month was almost 70% above the average for the 12 months to August 2015 at £83.00, illustrating the positive impact this month has on annual performance at hotels in the Scottish capital.

Once again the population of the city swelled this August as it played host to 50,549 performances of 3,414 shows in 313 venues as part of the annual Festival Fringe, fuelling demand for hotel accommodation in Edinburgh, as well as nearby cities, such as Stirling, Dunfermline and Glasgow.

Despite more than 1,000 bedrooms of accommodation entering the Edinburgh market in the last three years, the Festival Fringe has virtually doubled in size over the last decade, enabling hotels to continue recording strong performances, illustrated by the 6.0% increase in GOP in August 2015, to £94.41 per available room from £89.04 during the same period in 2014.

Heathrow Hotels Unable to Capitalise on a Record Breaking Month of Passenger Numbers

Heathrow Airport recorded its busiest ever month in August 2015, with 7.33 million passengers passing through the airport, equivalent to approximately 236,000 passengers per day.

However, Heathrow hoteliers suffered a month of profit decline, which was in spite of RevPAR remaining static at £59.64 for the month and payroll levels dropping by 0.7 percentage points to 29.9% of total revenue, from 30.5% of total revenue during the same period in 2014.

Declining ancillary spends, including food (-8.4%) and beverage (-0.2%) contributed to a 0.7% drop in TrevPAR to £85.95. This decline was further compounded by the 4.8% increase in overhead costs.

As a result, in contrast to the 4.0% year-on-year increase in passenger numbers at Heathrow Airport, bottom line performance at local hotels was down, with a 2.5% decrease in GOP recorded, to £27.11 from £27.81 during the same period in 2014.

Media Contact

Sita Banigo

Sales Executive [email protected]