Economy

Regional hotel chains report mixed results in May

Regional hotel chains continued to experience mixed year-on-year results across the UK in May, according to the latest HotStats UK Chain Hotels Market Review. 

According to the report, hotel chains in the West Midlands experienced one of the strongest performances with a 4.7% increase in gross operating profit per available room (GOPPAR), despite overheads per available room increasing by 1%.

West Midlands hotels also recorded a rise in occupancy of 1% to 69.5% and in average room rate (ARR) of 2.5% to £72.03, leading to a total revenue per available room (RevPAR) growth of 4% to £50.09. At the same time, hoteliers reduced payroll to 31.8% from 32.5%.

A closer look into the rooms department shows a 19.2% increase to £5.03 in travel agency commission per available room, compared to the same period last year. This means that of the £1.95 gain in RevPAR, £0.81 (or 41.5%) of the increase was paid away to third party intermediaries.

Hotel chains in Brighton reported a 6.4% decline in GOPPAR levels to £46.05, driven by decreases in meeting room hire (26.2%), food (5.8%) and beverage (2.3%).

However there was some positive news for Brighton hotels as a 3.7% surge in demand and 1.5% increase in ARR helped deliver RevPAR growth of 6.5%.

Meanwhile Nottingham hoteliers reported stagnant profits as RevPAR increased by 2.8% to £43.25, but GOPPAR levels remained stable at £23. Average room rate grew by 4.4% but profits were hit by a 1% fall in occupancy, a growth in payroll costs of 1% and a 2.2% surge in overheads per available room.

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