Hotels sector boosted by economic recovery
ANALYSIS from accountants PwC suggests the regional hotel sector has been boosted by the improving economic backdrop.
It suggests the regions have seen a “remarkable recovery” with continuously strong demand growth this year and, despite some variable performances around the country, have made strong progress.
The firm predicts the Manchester hotel market will strengthen over the next two years with more investment and openings. Among the new hotels will be Hotel la Tour near the Lowry Hotel and Bespoke Hotel’s Gotham City hotel at the top of King Street.
The biggest growth will come from the budget sector, PwC predicts. Its forecast for 2014 findsthat approximately 1,710 new rooms will be built in the city in 2014 and 2015, one of the highest of all the UK regions. The cities of Manchester, Birmingham, Glasgow and Liverpool will add a total of over 5,000 new rooms by 2016.
Budget style hotels still dominate the pipeline, as is the case in Manchester as Motel One, Yotel, a new Premier Inn and a Travelodge are due to open in the city next year and in 2015, adding almost 900 new budget rooms. Recently plans for a second Motel One have already been announced.
In Liverpool there will be investment in four star space too with an Aloft, a Pullman Liverpool Arena and a Doubletree by Hilton, to open.
Ian Marsden, head of PwC’s property team in the north, said: “The economy has put the fizz back into the UK hotel sector with a return to confidence and stronger demand. Despite ADR (average daily rate) levels still reflecting continuing consumer and corporate price sensitivity, it’s a very positive story. Continued economic recovery should mean sustained and enhanced prospects for hoteliers in 2014.”
PwC expects 1.8% RevPAR (revenue per room) growth in the regions in 2014, taking RevPAR to nearly £42.50, again the best result since 2008.
