UK average hotel room rates exceed £100

Average hotel room rates across the UK went over the £100 mark for the first time last year, according to a new report from accountancy firm BDO.

In Hotel Britain 2018, published today, room rates are shown to have increased by 3.4% year on year in 2017 to £100.58.

Meanwhile, rooms yield grew by 2.8% to £77.79 as occupancy remained largely flat, decreasing slightly by 0.5% due to the plethora of new hotel openings in London and the regions.

An influx of overseas visitors encouraged to travel to the UK as the result of the weak pound "resulted in a bumper year for the UK hotel market", said the report.

Robert Barnard, partner at BDO, explained: "The strong performance demonstrates the industry's robustness despite facing EU uncertainty, an increase in supply and the impact of several terror attacks across the country which occurred during the first half of the year.

"There will undoubtedly be challenges ahead. Rising payroll costs - such as the National Minimum Wage, the Living Wage and increased pension contributions - will impact the bottom line for many businesses. However, hoteliers with robust business strategies will continue to plan and adapt to the changing environment."

The pipeline of new UK hotel openings is expected to impact the sector's performance in the coming years with over 21,700 rooms in the active pipeline due to open during 2018 and 2019, of which 38% are in London.

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