Economic occupancy shines new light on UK hotel gains
 
Economic occupancy shines new light on UK hotel gains
10 AUGUST 2020 8:14 AM

All performance metrics continue to show slight improvement across the United Kingdom, especially in leisure markets.

LONDON—Another week has gone with another week of slightly improved occupancy and another small step forward in the Herculean effort to emerge from the COVID-19 crisis.

(STR is the parent company of Hotel News Now.)

Speaking during a video overview of United Kingdom hotel performance for the week of the 27 July to 2 August, STR director Thomas Emanuel said the pattern of improvement remains the same, with “weekend peaks, (and) for the last five weeks now, we have seen week-on-week improvements. Long may this continue.”

Average daily rate and revenue per available room declines have softened, too, with Emanuel stating ADR “declines stood at 30% last week when compared to the same week in 2019. Still significant, but certainly a better picture compared with the 48% declines we saw back in June.”

RevPAR is down for the U.K. between 59% and 69% compared with the same period last year.

While weekends are leading the charge, with Saturday, 1 August seeing overall occupancy of 52%, he said it was good to see midweek also showing a little growth.

Staycations and good weather have seen three southern coastal markets experience occupancy of more than 75%—Brighton (76%), Plymouth (80%) and Bournemouth (82%). Meanwhile, London, which Emanuel termed “(U.K.’s) laggard,” reported average occupancy for that week of only 25%.

He added that across the U.K. only approximately 20% of rooms have not reopened. In London, though, that number is 30%, largely due to a severe drop in business and meetings, incentives, conventions and expositions demand.

One market that is not fulfilling its potential, Emanuel said, is the Lake District, a leisure market, which he explained in terms of a new STR data methodology termed “economic occupancy.”

STR’s standard methodology “reporting occupancy” will measure demand via rooms booked versus supply in any market, while “economic occupancy” also takes into account those booking but against all rooms regardless of their status, Emanuel said.

Of course, many rooms remain closed for varying reasons, but while leisure markets such as Blackpool, Brighton and Bournemouth show similar patterns when measured in both methodologies, the Lake District shows a noticeable discrepancy.

For more of Emanuel’s insights into U.K. performance data and the methodology behind economic occupancy, watch the video below:

Editor’s note: The video included in this article was filmed Thomas Emanuel, director at STR, on 5 August and edited and produced by CoStar Group. HNN is a division of STR, a CoStar Group company.

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