EDINBURGH’S hotel sector achieved a 23 per cent year-on-year leap in revenue per available room in the second quarter, boosted partly by sterling weakness resulting from the Brexit vote, a survey shows.
International consultancy AlixPartners, publishing its latest survey of the sector, said hotels in Edinburgh had also benefited from the 1,200-strong delegation at the Microbiology Society Annual Conference. It also cited a boost from the Edinburgh International Science Festival and Melrose Sevens rugby tournament.
Belfast achieved 22 per cent year-on-year growth in revenue per available room (revpar) in the second quarter, AlixPartners’ hotel bulletin shows. This key industry measure is calculated by multiplying occupancy by average room rate achieved. The Cardiff hotel sector’s revpar in the second quarter was up by 17 per cent on a year earlier. And, in London, revpar was up by eight per cent year-on-year in the three months to June.
AlixPartners said: “All four of [the] UK’s capital cities recorded a strong performance in Q2 2017, attracting international tourists with the combination of high-profile events and a weaker pound. Edinburgh registered the strongest performance of the four, with 23 per cent revpar growth.”
It highlighted Edinburgh’s popularity as a conference destination, and noted the boost to the city from “the 12 festivals it hosts each year, which collectively attract four million visitors”.
Edinburgh’s average room rate in the second quarter was up by 17 per cent on the same period of last year, with occupancy also higher.
For a tenth consecutive quarter, the Aberdeen hotel sector’s revpar showed a year-on-year drop. Revpar for the Granite City’s hotel sector in the second quarter was down by 11 per cent on a year earlier.
But AlixPartners noted that, “despite weak demand metrics”, Aberdeen still had an active hotel development pipeline of 12 per cent of current supply.
The Aberdeen hotel sector has been hit hard by the oil and gas industry downturn.
Revpar for Glasgow’s hotel sector in the second quarter was up by six per cent on the same period of last year. The average room rate for Glasgow hotels in the second quarter was up by two per cent on a year earlier.
Highlighting the boost to the hotel sectors in Edinburgh, Cardiff, London, and Belfast from the weak pound, AlixPartners said: “The UK capital cities were among the top performers of the cities reviewed in this issue of the hotel bulletin, suggesting that overseas holidaymakers are continuing to take advantage of the depreciated pound.”
It added: “The weaker pound [has] resulted in a surge in foreign visitors to the UK in 2017 - there was a 10 per cent rise in overseas visitor numbers in Q1 2017 compared with the previous year.”
AlixPartners noted that Belfast was “uniquely positioned” to take advantage of the weak pound because it “attracts visitors from over the border in the Republic of Ireland”.
The consultancy reported that development and supply in the UK hotel sector continued to experience strong growth, with more than 7,500 rooms opening in the first half of this year. AlixPartners noted this was the highest figure for any first half since 2012, and was up by more than 40 per cent on the same period of 2016.
It said Premier Inn had maintained its “robust expansion” in the second quarter.
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