UK hotel occupancy saw a sharp increase in February as the easing of restrictions and half term breaks coincided to increase demand across the UK, according to the RSM Hotels Tracker.
The data, compiled and produced by STR and analysed by RSM, shows an 18 per cent point increase in UK occupancy from 47 per cent in January to 65 per cent in February in line with expected seasonal trends. However, UK occupancy still sits 8 per cent behind pre-pandemic levels.
Among key countries in the region, Wales saw the largest month-over-month increase of 21 per cent closely followed by Scotland at 20 per cent. Of note, London’s occupancy also increased 20 per cent over January. Despite seeing a strong increase in February, London remains 19 per cent behind pre-pandemic levels due to reduced international tourism and business travel, which is pulling down the UK average.
Average daily rates (ADR) in UK hotels jumped £14 month on month and surpassed pre-pandemic prices at £86, whilst revenue per available room increased from £34 to £55, but still sits £4 behind February 2020 rates.
Chris Tate, head of hotels and accommodation at RSM, said ‘Easing of restrictions and a February half-term boost has bolstered UK occupancy, but, without the return of significant business travel, the oversupply in the Capital continues to bring the UK average in behind pre-pandemic levels.
‘Increases in average daily rates and revenues per available room are good to see, but due to the inflationary impact over the last two years reaching pre-Covid levels will still feel like a shortfall for hoteliers. However, nearly a quarter of pre-bookings for March will be a welcome boost for the sector, as the upward trajectory for occupancy looks set to continue.
‘Despite positivity, economic headwinds are ahead. Soaring energy and supply chain costs, which could worsen due to the Russia/Ukraine conflict; rates and VAT reliefs coming to an end; rising inflation and increasing labour costs all present the perfect economic storm for hoteliers. The Chancellor needs to step up and respond to calls to extend VAT support, whilst offering further support to mitigate the energy burden on hotel businesses, in this week’s Spring Statement to aid recovery into the Spring/Summer season.’ /Ends.