UK weekly metrics soften post-bank holiday lift
UK weekly metrics soften post-bank holiday lift
14 SEPTEMBER 2020 7:54 AM

The loss of short-term demand drivers is hurting U.K. hotels, according to data from STR.

LONDON—In comparison to the prior week, nationwide hotel occupancy in the United Kingdom experienced an 11-percentage point drop for the week ending 6 September, which is “quite significant,” according to Thomas Emanuel, director, Europe, at STR.

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

Factors contributing to this impact include the end to school summer holidays and an “Eat Out to Help Out” scheme in the U.K. as well as no pickup in corporate or international demand, he said. Occupancy dropped from 57% the week before last to 46% the week ending 6 September, based on data only from hotels that are open and reporting to STR.

“We know that the bank holiday weekend really drove performance, so combined with the lack of demand drivers previously mentioned, it is not too much of a surprise to see this decline,” he said. “The occupancy pattern remains, however, with weekend peaks and weekday troughs.”

Average daily rate also showed a highly visible decline for the week, he said. Last week’s ADR was 28% lower than the same week in 2019, which is in line with the year-over-year declines seen in late July and early August.

“So naturally, (revenue per available room) also moved south last week. Daily RevPAR declines varied between 66% and 50% when compared to (2019). This showcases very clearly the challenging times the industry continues to face,” he said.

Source: STR, © 2020 CoStar Realty Information, Inc.

Emanuel said when looking at daily data, Saturdays are still the best performing night of the week, at 58% “compared to the laggards of Sunday and Monday night, both of which recorded occupancy of just 37%.”

Source: STR, © 2020 CoStar Realty Information, Inc.

The weekday versus weekend gap continues to show the extent to which any present demand is coming from leisure travel.

After a strong occupancy gain of 23% in London during the week of the bank holiday, week-on-week occupancy fell back by 22% the week ending 6 September, he said.

“Once again, the differences in occupancy changes were unsurprisingly felt more heavily in our largest cities,” he said.

Source: STR, © 2020 CoStar Realty Information, Inc.

Outside of London, week-on-week declines reached 33% in Cardiff, 27% in Newcastle and 22% in both Leeds and Edinburgh.

“Until we see a return of corporate conference or international demand, our cities are going to continue to struggle,” he added.

Additionally, the ending of school summer breaks in the U.K. also influenced coast and country regional markets as well as leisure destinations. The biggest occupancy declines were in Brighton and York with 20% and 18% declines, respectively. Devon and Cornwall Regional and Dorset Regional held up better, with week-on-week declines of just 5% and 6%, respectively.

For some positive news, Emanuel said that despite declines, many markets still saw healthy occupancy levels for the week ending 6 September. Markets such as North Wales Regional, the Lake District, Plymouth, Bournemouth, Norfolk & Suffolk Regional all had occupancies of between 80% and 90%.

For more depth into the weekly U.K. hotel performance data, watch the video below.

Editor’s note: The video included in this article was filmed by Thomas Emanuel, director at STR, on 10 September and edited and produced by CoStar Group. HNN is a division of STR, a CoStar Group company.

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