Positive first quarter for the UK hotel market
Optimism for continued robust trading in the months ahead, along with signs that energy costs appear to have reached their peaked.
17 May 2023
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- London continues to witness a strong recovery in occupancy performance, with 74.4% occupancy achieved, some 13 basis points above March-2022.
- Regional UK achieved 71% occupancy, an increase of six percentage points versus March-2022.
- ADR growth of 4% in London and 1.8% Regional UK versus March-2022, respectable growth but constrained by normal seasonal demand patterns.
- Strong RevPAR recovery of 25% in Regional UK and 66% in London for the first quarter of 2023, compared to an Omicron-impacted Q1-2022.
- Slower RevPAR recovery in regional UK鈥檚 top 12 cities compared to the wider regional UK market, but with improving Total Revenue recovery (TRevPAR), as higher occupancies support growth in F&B revenues.
- Strong rise in utility costs versus March-2022, with an increase in London of 45% and 20% across Regional UK, but with costs PAR declining month-on-month since January.
- Utility costs in March averaged 8.5% of total revenue across Regional UK and 5.1% in London.
- Total payroll costs increased on average by 8% to £77 PAR across London hotels and by 5% in Regional UK to £47 PAR, versus March-2022.
- Despite rising cost pressures over the past 12 months, strong uplift in GOPPAR in the first three months of 2023, compared to Q1-2022. As of March YTD, London鈥檚 GOP is up by 95% to £57 PAR and a more modest uplift of 28% in Regional UK to £19 PAR.
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