Economy

Profit levels plunge at York hotels following flooding

Profit per room at hotels in York has plunged by 41.5% in the first two months of 2016, as a result of the floods that devastated the city in December.

That’s according to new data from HotStats’ latest UK Chain Hotels Market Review, which also found – despite the floods – occupancy levels in the city have been on the decline for the last year falling by 6.1% to 76.6% in the 12 months to February 2016, from 82.7% in the 12 months to February 2015.

The drop in occupancy has contributed to a slow and steady fall in revenue per available room (RevPAR) over the last year, alongside growth in labour costs, which have increased by 14% over the last three years.

Hotels in York recorded RevPAR growth of 1.3% in February. However,  total revenue per available room (TrevPAR) dropped 1.1%, as food and beverage revenue fell by 3.6% and conferencing and banqueting recorded a year-on-year decline of 18.7%.

The drop in TrevPAR was further exacerbated by year-on-year cost increases in payroll (6.6%), sales and marketing expenses (17.1%), property and maintenance payroll (23.8%) and repairs to flood-damaged hotels.

Meanwhile, the report added  RevPAR levels for Birmingham hotels reached new heights this month at £54.67 in the 12 months to February 2016.

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