A surge in demand for hotel rooms across the UK is increasingly pushing up daily rates for rooms. As a result, most hotel businesses see their revenues skyrocketing.
Occupancy levels in the UK rose 10 per cent from the first quarter of this year to 80 per cent in the second quarter, BNP Paribas Real Estate said this morning.
This is the highest fourth quarter since 2019, so before the pandemic took hold and sent hotel demand plunging.
During the last quarter, hoteliers hiked prices to reflect the higher occupancy levels amid record inflation.
Dampened economic outlook caused transactions to decline, but this was still the best second quarter since 2018 with investment volumes at £1.2bn.
“The latest average daily rate growth figures are a reflection of the current confidence of hotel operators to raise their rates in light of high demand levels and in spite of the challenging economic backdrop,” explained Rebecca Shafran, senior associate director for alternative markets research at BNP Paribas Real Estate.
“Generational change and increased sentiment towards international travel, events and return to work has a lot to do with this,” she added.