UK hotel occupancy steadily softening amid COVID wave
UK hotel occupancy steadily softening amid COVID wave
26 OCTOBER 2020 7:34 AM

Weekend leisure travel continues to be the biggest demand driver for the country’s hotels, but STR data shows that occupancy premium is also shrinking.

REPORT FROM THE U.K.—September and the most recent weekly data for the United Kingdom hotel industry show a country grappling with a second wave of the COVID-19 virus and local lockdowns in response, STR director Thomas Emanuel said.

“Unsurprisingly the data is looking pretty bleak,” Emanuel said in a video sharing his insights. (STR is the parent company of Hotel News Now.)

The biggest indicator of a slowdown in hotel demand for the U.K. is a week-over-week softening of occupancy for the country overall, which “has been a consistent pattern since the peak of the August bank holiday,” he said, adding “the last three weeks have steadily become weaker as (COVID-19) cases and local lockdowns have increased.”

There is some solace in weekend demand peaks, which show leisure travel continues to be the greatest demand driver for the country’s hotels.

However, “while leisure demand is stronger on weekends, that occupancy premium is now becoming smaller,” Emanuel said.

Average daily rate for U.K. hotels has settled at between 30% to 35% below 2019 levels, while declines in revenue per available room have increased slightly (between -62% and -73% daily for the week ending 18 October).

Across the U.K., “cities have struggled with lack of any corporate conference or international demand,” Emanuel said.

“While some smaller cities such as Inverness (81% occupancy) and Plymouth (84% occupancy) have performed relatively well, Glasgow (36%), Manchester (38%) and Birmingham (33%) were all below 40% occupancy and London below 30% (29%),” he said.

“The doom and gloom however did not extend to coast and country markets,” he said, noting hotel occupancy in the Dorset Regional, Cornwall and Devon, and Lake District markets were all above 80% for September. Occupancies in these markets were lower for the week ending 18 October, but still above 75%.

For more insights on the STR data, including a look at how hotel business on the books is shaping up, watch the video below:

Editor’s note: The video included in this article was filmed by Thomas Emanuel, director at STR, on 22 October and edited and produced by CoStar Group. HNN is a division of STR, a CoStar Group company.

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