According to the firm the positive results highlight the “resilience” of the London hotel market and its capacity to “absorb new supply” following the opening of approximately 8,000 rooms in 2017-2018.
In comparison to the “strong performance” seen in the London hotel market, a decline in regional hotels’ Average Achieved Room Rate (AARR) dragged overall performance down by 1.3%. Despite the overall weaker results for the regional market, regional hotels set a new record high occupancy at 76.9%.
Additionally, the strong performance also comes despite a drop in visitor numbers. According to ONS and VisitBritain, the UK welcomed 37.8 million visitors in 2018 – down 3.5% from the 39.2 million visitors the previous year. But BDO said an “uplift” is predicted, with an additional million visitors expected in 2019.
A statement by the firm read: “Townhouse and boutique hotels experienced the best performance among the capital’s hotel segments with rooms yield up by 10.8%, building on the strong results of 2016.
“Most of London’s hotel segments experienced rooms yield growth in 2017 with the only exceptions being deluxe and superior deluxe hotels, whose declines in occupancy could not be overcome by the modest AARR performance seen in those segments.”