Decline is slowing for city hotels
HOTELS in the cities of Liverpool and Manchester continued to suffer the effects of the recession over the last five months, although there were signs of improvement, according to new research.
The research by Deloitte on the performance of the UK’s hotel sector since the beginning of this year shows that there has been some improvement across the UK.
While revenue for each available room is still negative, the pace of decline is reducing and some markets are actually showing gains on 2008 numbers with strong leisure demand driving up weekend occupancies and revenues, according to the report.
The only areas yet to show an improvement are weekday demand in the regions and the country’s airport hotels where trading continues to be tough.
Weekend leisure demand is driving the recovery with much stronger performance than corporate weekday demand. Revenue per available room across the UK was down 3.8% to £54 on the weekend while weekday drops were more severe, down 14.6% to £58 from 1st January through to 20th May 2009.
In Liverpool weekend revenues per available room was well ahead of the UK average at £60, but the weekday figure was just £43– demonstrating an 8%and 20% fall in revenue, respectively.
In Manchester that revenue figure stood at an average of £48 in the week and £54 at the weekend – a 23% and 14% drop respectively.
Paul Lupton, North West head of corporate finance advisory at Deloitte, said: “The UK tourism industry continues to be challenged by the recession, with some companies announcing record losses and year-to-April revPAR, the hotel industry’s leading performance indicator, down 11.1%.
“However, our analysis shows that both weekend leisure demand in London and the regions and corporate weekday demand in London over the past five months has shown an upward trend, signalling that the worst may be over for hoteliers.”
Lupton added: “Clearly one of the factors driving the upward trend across the country is the increasing number of Brits taking short breaks in the UK, where sterling stretches further than in Europe.”
