UK hotels experience slowdown in September

The following press release from PKF UK (LLP) is included below:

UK hoteliers saw visitor numbers decline in September and, as a result of some softening in demand, room rates have declined as the fallout from the turmoil in the markets affected business travel, according to preliminary monthly figures released today by PKF Hotel Consultancy Services. The decreases were relatively small so fundamental occupancy levels still remain strong across the majority of the country.

In London , room rate was down 1.5% on the same time last year from £149.13 in 2007 to £146.92 this year. Occupancy nevertheless was at 81.6% for the capital, but this was down 5.7% on the same time last year and as a result, rooms yield declined from £128.95 in 2007 to £119.83 in 2008 – a fall of 7.1%.

In the regions, there was a similar story as occupancy dropped 3.4% from 78.9% to 76.3%, while room rate was down 0.3% on September 2007. In turn, rooms yield dropped from £60.72 in 2007 to £58.49 this year.

Cardiff experienced the largest falls in the survey with rooms yield down 15.9% from £66.26 last year to £55.73 this year. The main factor behind the drop was the 14.6% fall in room rate, occupancy only fell 1.5%. The falls can be explained in part because last year Cardiff played host to a number of the Rugby World Cup matches which boosted the city’s hotels.

In contrast, both Manchester and Liverpool achieved growth in rooms yield – Liverpool by 2.4% and Manchester by 2.7%. This is probably a reflection of Liverpool’s 2008 status as European Capital of Culture bringing visitors to both the cities’ hotels.

Robert Barnard, partner for Hotel Consultancy Services at PKF, commented, “The decreases that hoteliers experienced this month are not surprising given the current turmoil in the markets which is undoubtedly affecting business travel."

“However, it should also be noted that hoteliers did have a particularly strong September in 2007 and this goes some way to explaining some of the decreases."

“Overall, it is important to note that despite the drops, occupancy levels, as well as room rate and rooms yield figures, are still fundamentally healthy due to two strong years of growth in 2006 and 2007 and hoteliers are therefore in a good position to weather the current climate.”

Preliminary data for September 2008

Rooms department	2008	2007	% change
UK Regional hotels (485)
Average daily room rate per occupied room	£76.69	£76.94	-0.3
Average daily room occupancy	76.3%	78.9%	-3.4
Average daily rooms yield per available room	£58.49	£60.72	-3.7
Approximate number of rooms per day	65,700	64,800
London hotels (151)
Average daily room rate per occupied room	£146.92	£149.13	-1.5
Average daily room occupancy	81.6%	86.4%	-5.7
Average daily rooms yield per available room	£119.83	£128.95	-7.1
Approximate number of rooms per day	31,450	31,950

– ends –

For further information or to speak to Robert, please contact the PR team:

Jane Murray 020 7065 0135

Elizabeth Faulkner 020 7065 0573

Notes to Editors:

1. PKF is a leading firm of accountants and business advisers with more than 1,800 partners and staff operating in 23 offices in the UK mainland firm, a wholly-owned financial planning company and associated offshore practices. The firm specialises in advising growing and entrepreneurial/owner-managed businesses, AIM and fully listed companies, and also has extensive experience in the public and not-for-profit sectors. Principal services include assurance and advisory; taxation; consultancy; corporate recovery and insolvency; corporate finance and forensic. The firm has particular expertise in advising sectors such as hotels and leisure; mining and resource; public sector; real estate and construction; professional practices; not-for-profit; and medical. The firm’s web site is www.pkf.co.uk.

2. PKF (UK) LLP is a member of PKF International which is an association of legally independent firms with more than 14,650 people operating in 119 countries around the world.

PKF has been providing hotel consultancy services since the early 1970s and, in that time, has undertaken thousands of assignments throughout Europe, the Middle East and Africa and further a field. Services include: market evaluation and financial feasibility studies; operational and profit improvement reviews; asset management; business valuations; international property services; corporate strategy and planning; litigation support. PKF’s web site features regular articles from the firm’s hotel consultancy services experts on industry topics – the address is www.pkf.co.uk/hotelcons.

PKF’s hotel trends surveys feature a broad range of hotels across the country although mainly in the 3 – 4 star categories and featuring rather more chain operated hotels than those operated independently. While there are a fair number of hotels in country and rural areas, there is a predominance of hotels in towns and cities. In London ,supply featured is mainly in the 3 –5 star categories.

Final data for August 2008

Rooms department	2008	2007	% change
UK Regional hotels	556	556
Average daily room rate per occupied room	£73.00	£71.63	1.9
Average daily occupancy	72.4%	73.9%	-2.1
Average daily rooms yield per available room	£52.83	£52.96	-0.3
Approximate number of rooms per day	77,350	77,500
London hotels	175	175
Average daily room rate per occupied room	£133.28	£125.93	5.8
Average daily room occupancy	83.1%	84.0%	-1.1
Average daily rooms yield per available room	£110.75	£105.79	4.7
Approximate number of rooms per day	38,600	39,250

Definition of the key terms used in the surveys table are given below:

Room occupancy: the ratio of total occupied rooms to total available rooms

Average achieved room rate (AARR): rooms revenue divided by the total number of guest rooms occupied during the year.

Rooms yield: room occupancy multiplied by the average achieved room rate (also known as RevPar).