PKF London Trends 2002 survey
PKF has released the results of its London Trends 2002 survey which shows the extent of London hotels’ annus horribilis.
The survey shows how the capital’s hotels which were battered by the combination of the US economic slowdown, the foot and mouth outbreak, and the 11 September terrorist attacks.
Occupancy was the worst affected, falling 9.7% to 72.9% which was the first time in eight years that it had fallen below 80%. Average rate, however, was only down 4.1% to £108.85 which is still the seventh best ever year in constant values since PKF’s records began in 1973. This combination meant that rooms yield in 2001 was down by 13.4% to £79.35 and included the largest ever single-month drop of 34.1% for October to £68.84.
Melvin Gold, Managing Director of Hotel Consultancy Services at PKF, said: “Whilst it cannot be denied that the London hotel industry suffered a bad year, it was 2001’s misfortune to follow the millennium, a year of record-breaking success. There was never any expectation that London hotels would be able to match the second highest ever rooms yield (in constant values) of £91.59 achieved in 2000.”
London Trends 2002 also highlights the impact that the 2001 decline in occupancy had on the mix of nationalities staying in London hotels. The proportion of North American visitors dropped by 24.8%, Japanese visitors by 11.6% and European visitors 4.9%. London hotels thus had to rely more on domestic custom which increased its percentage of ‘room nights’ by 11.9% to 35.6% of the total.
The survey results also show the difference in performance between inner and outer London hotels. Inner London hotels, which are more dependent on overseas tourists, suffered a 13.8% drop in rooms yield to £81.41 whilst outer London hotels, which have their own local demand, only fell 2.7%.
Melvin Gold, however, remains positive about the long-term prospects for the capital’s hotels. He said: “London hoteliers are made of stern stuff and have become adept at adjusting to circumstances. Whilst 2001 may have seemed like an annus horribilis, it should be regarded more as a dip caused by variety of different and unforeseen circumstances from which the industry will recover. Fortunately, there are a number of events such as the Queen’s Golden Jubilee and the biennial Farnborough Airshow to look forward to in 2002.”
Allan Sugg, Hotel Sector Leader at EC Harris, said: “Despite the delay to a number of projects scheduled for 2001, there are many major hotel openings scheduled for 2002 such as the Crowne Plaza London – the City, Hilton London Paddington, the London Marriott Hotel Park Lane, and Grange City. These will all help to restore morale and focus good news on the London market.”
Summary of London Trends 2002 Survey Results
|
Rooms Department |
2001 |
2000 |
% change |
|
London hotels (152) |
|||
|
Average daily room rate per occupied room |
£108.85 |
£113.49 |
-4.1 |
|
Average daily room occupancy |
72.9% |
80.7% |
-9.7 |
|
Average daily rooms yield per available room |
£79.35 |
£91.59 |
-13.4 |
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