Manchester and Salford to see 20% rise in hotel room supply
The supply and demand of hotels in Manchester and Salford is becoming well-balanced with an additional 2,713 rooms due for delivery in the next two years, according to international real estate advisor Savills.
If the full 2018-20 pipeline is delivered, the firm says it will increase total hotel room supply by 20%.
The last decade saw a high level of applications for new hotels in Manchester and Salford though the actual delivery of rooms was comparatively restrained until recently, reports Savills, when 874 rooms were added to supply in 2017.
Consequently, while revenue per available room (RevPAR) increased by an above average 5.7% in 2016, it grew by only 0.4% in the year to September 2017 as more rooms entered the market.
This puts Manchester at the lower end of the UK city rankings but is ultimately positive, indicating that supply of and demand for rooms is broadly in balance.
Tom Cunningham, hotels director at Savills Manchester, said: “In the next two years, the biggest gain in room numbers will be in the 4 star segment and the greatest percentage increase will be in the serviced apartment market. This pipeline, combined with modest increases in demand and performance, is probably all that the city needs to satisfy demand and maintain viability for the immediate future.”
Savills also reports that although some European and global cities have either experienced or speculated that the emergence of alternative lodging models such as Airbnb is a challenge to hotel viability, this is less true in the UK and specifically in Manchester.
While Airbnb rentals in Paris account for nearly 2.5% of the total residential stock in the city, in Manchester and London they are still only 0.4% and 0.8% respectively.
