Pandemic widens losses at Dorchester Collection

The impact of the pandemic saw losses widen at the Dorchester Group, with revenue falling from £373.1m in 2019 to £128.9m in 2020.

This resulted in a pre-tax loss of £208.5m in 2020, having posted a £10.3m loss the prior year. The group’s hotel occupancy rate was 18% compared to 60% in 2019, while the average room rate decreased from £672 to £566 and revenue per available room (revpar) decreased from £402 to £104.

The group owns the five-red-AA-star, 250-bedroom Dorchester hotel in London (pictured) and leases the five-red-AA-star, 46-bedroom 45 Park Lane opposite, as well as the five-red-AA-star, 70-bedroom Coworth Park in Ascot, Berkshire. Its portfolio also includes properties in Los Angeles, Rome, Milan and Paris.

The Dorchester Collection is owned by the Brunei Investment Agency, the sovereign wealth fund of the Sultan of Brunei.

The group said the pandemic “remains a key challenge, and uncertainty as to how the situation will develop makes it difficult to give accurate guidance on the financial forecasts… The group continues to be well placed in our existing mature markets in Europe and USA as well as in other critical markets such as Russia and the Middle East. This, together with our robust sales, marketing and revenue management strategies and our proven ability to build compelling product offerings, will continue to help Dorchester Collection increase market share during periods of both high and low overall demand.”

In documents filed with Companies House, the group said the luxury hotel sector was “expected to recover strongly” and the group would continue to pursue opportunities through organic growth, acquisitions and third-party management contracts.

Although the business had net liabilities of £18m at the end of the year, the group confirmed it had the continuing support of the Brunei Investment Agency, which was “willing to support the company should cash funding be required”.

Over the three years 2021/22 to 2024/25, the Dorchester intends to undergo a carbon footprint reduction programme including energy saving and efficiency, and the implementation of a smart building management system.