27. Juli 2010 
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Strongest month for RevPAR growth of 2010 causes a surge in profitability in London
Room rates in London have surged through their previous peak of June 2008 as profitability at hotels in the UK capital soars, according to the latest HotStats survey from TRI Hospitality Consulting.
A year-on-year increase in Revenue per Available Room (RevPAR) of 15.8% in the month of June has led to a 14.9% increase in Gross Operating Profit per Available Room (GOPPAR) at London hotels. The strong RevPAR growth in London was led by an exceptional increase in achieved average room rate of 11.2%, to £131.23.
The overall rate increase was primarily due to a 22% uplift in achieved rates in the nondiscounted rack rate market segment and the leisure sector, which is unsurprising considering that June is traditionally the strongest performing month in the capital, driven by a good mix of commercial and leisure demand and boosted by major events such as Wimbledon, which attracts over half a million visitors to London. As a result, London hoteliers recorded the highest room occupancy levels of the year in June, at 87.5%, an increase of 3.4 percentage points against 2009.
For London hoteliers, the increase in volume resulted in a number of efficiencies being achieved, namely a 1.4 percentage point decrease in payroll as a percentage of total revenue, to 22.1%. Contributing to the 14.9% increase in profitability, this resulted in a GOPPAR of £80.07.
Whilst the positive movement in headline performance levels in June put the capital ahead of those levels achieved prior to the economic downturn, the disruption caused by the snow in January and the ash cloud in April has left London hoteliers slightly behind over the first six months of the year.
That said, in the period from January to June 2010, year-on-year GOPPAR in London increased by 12%. This has primarily been driven by a 6.1% increase in average room rates and the excellent cost management by London hoteliers.
“Hotel managers in London have put on a stunning performance in the first six months of the year. Were it not for the major disruptions caused by mother nature in January and April, the capital’s hotels may have ended the first six months ahead of the headline performance levels achieved prior to the economic downturn in 2008”, said Jonathan Langston, managing director, TRI Hospitality Consulting.
Forward momentum halted in the Provinces
A growth in RevPAR of 1.3% in the month of June was not enough to prevent a return to yearon-year profitability decline for Provincial hoteliers, according to the latest HotStats survey from TRI Hospitality Consulting.
A year-on-year increase in Revenue per Available Room (RevPAR) of 15.8% in the month of June has led to a 14.9% increase in Gross Operating Profit per Available Room (GOPPAR) at London hotels. The strong RevPAR growth in London was led by an exceptional increase in achieved average room rate of 11.2%, to £131.23.
The overall rate increase was primarily due to a 22% uplift in achieved rates in the nondiscounted rack rate market segment and the leisure sector, which is unsurprising considering that June is traditionally the strongest performing month in the capital, driven by a good mix of commercial and leisure demand and boosted by major events such as Wimbledon, which attracts over half a million visitors to London. As a result, London hoteliers recorded the highest room occupancy levels of the year in June, at 87.5%, an increase of 3.4 percentage points against 2009.
For London hoteliers, the increase in volume resulted in a number of efficiencies being achieved, namely a 1.4 percentage point decrease in payroll as a percentage of total revenue, to 22.1%. Contributing to the 14.9% increase in profitability, this resulted in a GOPPAR of £80.07.
Whilst the positive movement in headline performance levels in June put the capital ahead of those levels achieved prior to the economic downturn, the disruption caused by the snow in January and the ash cloud in April has left London hoteliers slightly behind over the first six months of the year.
That said, in the period from January to June 2010, year-on-year GOPPAR in London increased by 12%. This has primarily been driven by a 6.1% increase in average room rates and the excellent cost management by London hoteliers.
“Hotel managers in London have put on a stunning performance in the first six months of the year. Were it not for the major disruptions caused by mother nature in January and April, the capital’s hotels may have ended the first six months ahead of the headline performance levels achieved prior to the economic downturn in 2008”, said Jonathan Langston, managing director, TRI Hospitality Consulting.
Forward momentum halted in the Provinces
A growth in RevPAR of 1.3% in the month of June was not enough to prevent a return to yearon-year profitability decline for Provincial hoteliers, according to the latest HotStats survey from TRI Hospitality Consulting.
