Hotels must price rooms sensibly for Olympics after Royal Wedding let-down

03 June 2011 by
Hotels must price rooms sensibly for Olympics after Royal Wedding let-down

Hotels are being warned to set room rates at sensible levels during the Olympics after dramatic price hikes for the Royal Wedding contributed to disappointing occupancy levels.

The HotSats survey from TRI Hospitality Consulting - based on figures from 551 full-service hotels across the UK with an average bedroom stock of 182 - showed that room occupancy in London dropped to around 60% on the day of the wedding (29 April).

"It was widely anticipated that the Royal Wedding would cause a significant boost to headline performance levels for London hoteliers in April," said Jonathan Langston, managing director of Tri Hospitality Consulting.

"However, whether it was due to high pricing in the full-service market or a higher than forecast proportion of day trippers, it is clear the expected demand did not materialise."

Oliver Raggett, general manager of the four-star, 107-bedroom Chesterfield Mayfair hotel, confirmed that despite the perception that the capital was going to be full, the reality was very different.

"London lost a lot of corporate business as it was only a three-day working week, with the Royal Wedding weekend following straight after Easter," he said. "But I think business was also lost by people being scared off by some hotels which were charging seven times their normal rates."

A spokesman for Hilton Worldwide said that despite many promotions the level of business for the Royal Wedding weekend did not fully materialise. "We believe that because many people were able to take 11 days of consecutive holiday they travelled to other destinations," he said. "Also, as the event was not a state occasion officials from around the world did not travel to London."

Chloe Couchman of London & Partners (formerly Visit London), said that low hotel occupancy during the Royal Wedding was party due to unrealistic pricing and set day packages, as well as a significant number of visitors staying with family and friends.

"We believe the key learning for the Olympics from the Royal Wedding was that hotels should price realistically and avoid set/inflexible packages," said Couchman.

Peter Hancock, chief executive of Pride of Britain said that it was important to appreciate the long-term value of the event.

"The Royal Wedding has been a splendid showcase for this country and should have lasting benefits in drawing visitors to London and the rest of the UK," he said.

London restaurants seem to have had an equally tough time during the Royal Wedding week, with numerous operators saying that business was down significantly in April.

The back-to-back bank holiday weekends meant many Londoners left the capital and those who remained to celebrate the Royal Wedding mostly did so at home and in the streets.

Pascal Aussignac, chef-proprietor of the Club Gascon group of restaurants, said April was a terrible month.

"Business across all our restaurants including Chip and Fish at Westfield was down, which goes to show that all segments of food service were affected," he said.

Xavier Rousset, co-owner of London restaurants Texture and 2850, agreed. "Lots of people were away during that bank holiday week and the City in particular was very empty," he added.

"At Texture April was our worst month in about 18 months and at 2850 it was the worst since last September."

Royal Wedding was disappointing for London hotels >>

How UK hospitality can learn lessons from other Olympic hosts >>

By Janet Harmer

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