UK CHAIN HOTELS
MARKET REVIEW
DECEMBER 2016
Revenue and Profit Fall at London Hotels in 2016
Hotels in London recorded a 2.6% decline in profit per room in
2016, which was in spite of a 0.5% increase in RevPAR,
according to the latest data from HotStats.
Whilst the addition of more 4,500 bedrooms of new supply into
the capital undoubtedly diluted room occupancy performance,
leading to a 0.4 percentage point decline to 80.8%, a 1.1%
increase in achieved average room rate to £154.26, helped to
recoup the occupancy losses and drive growth in RevPAR
(Revenue per Available Room) to £124.60 for 2016.
However, in a bid to achieve RevPAR growth for year-end 2016,
hotels in London failed to maintain growth in other departments,
suffering declines in ancillary revenues, including Food and
Beverage (-0.9%) and Conference and Banqueting (-2.7%). As a
result of the decline in ancillary revenues, the growth in RevPAR
was entirely cancelled out and London hotels recorded a 0.6%
drop in Total Revenue in 2016.
Furthermore, a 36.8% year-on-year increase in Rooms Costs of
Sales for the month of December suggests that the proportion of
demand booking via high-cost Online Travel Agents into London
increased significantly as hoteliers fought to record an increase
in RevPAR for year end 2016.
As a result of the rising costs across the operation, hotels in
London recorded a profit decline in both the Rooms (-0.4%) and
Food and Beverage (-3.8%) departments in 2016, further
compounding the overall profit decline at hotels in the capital this
year.
Edinburgh Hotels Top the Profit Growth
Table in 2016
Hotels in Edinburgh recorded a 12.0% increase in profit per room
in 2016, as hotel managers in the Scottish capital were able to
combine an increase in revenues with a reduction in costs.
Profit growth for Edinburgh hotels is once again at the top of the
table of key cities in the UK following a mixed profit performance
in 2014 (+4.4%) and 2015 (-0.4%).
The growth in revenue in the Scottish capital was led by strong
room occupancy levels, which remained amongst the highest in
the UK in 2016, increasing by 1.4 percentage points to 82.9%
enabling hoteliers to leverage achieved average room rate by
8.4%, to a record high of £114.15.
The growth in the achieved rate in the leisure (+13.2%) as well
as corporate (+4.6%) segments suggests Edinburgh remains a
key economic and visitor hub. Furthermore, the ongoing success
of the Edinburgh Fringe Festival fuelled an 11.6% increase in
RevPAR in August to £163.25.
In addition to the growth in revenue in 2016, hotels in Edinburgh
recorded a 0.4 percentage point decline in payroll to 27.4% of
total revenue, helping to drive a profit conversion of 38.3% of
total revenue.
Absence of Events in Cardiff in 2016
Hits Hotel Profit Hard
Profit per room at Cardiff hotels fell by 6.1% in 2016 due to the
absence of a number of key events in the city, but particularly the
demand created by the 2015 Rugby World Cup fixtures.
Despite a positive first half of the year for hotels in Cardiff, during
which they achieved a 3.6% increase in RevPAR and a 5.1%
increase in profit per room, such was the significance of the year
-on-year declines in September and October, that the entire year
of performance was negatively impacted.
The considerably lower demand levels prohibited Cardiff
hoteliers from driving premium room rates and as a result yearon-year RevPAR fell significantly in both September (-16.6%)
and October (-35.8%).
In addition, declines in ancillary departments and rising costs
added further woe to a tough period of operation, resulting in
year-on-year profit per room plummeting in September (-28.1%)
and October (-46.0%) 2016, compared to the same period in
2015.
Last three months year-on-year change
TREVPAR VARIANCE
London
HotStats UK Chain Hotels Market Review
GOP PAR VARIANCE
Edinburgh
Cardiff
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UK CHAIN HOTELS
MARKET REVIEW
DECEMBER 2016
Editor’s Notes
The hotels profiled in this report are drawn from
the HotStats database and reflect the portfolios
and distribution of the hotel chains that we
survey and which operate primarily in the fullservice sector.
Please note: The data samples are reviewed and
rebased each year to reflect the changes in the HotStats
survey base. As a result, performance ratios published
last year may differ from those contained within this
report.
Occupancy (%) - Is that proportion of the bedrooms available
during the period which are occupied during the period.
Average Room Rate (ARR) - Is the total bedroom revenue
for the period divided by the total bedrooms occupied during
the period.
Room Revpar (RevPAR) - Is the total bedroom revenue for
the period divided by the total available rooms during the
period.
Total Revpar (TRevPAR) - Is the combined total of all
revenues divided by the total available rooms during
the period.
Payroll % - Is the payroll for all hotels in the sample as a
percentage of total revenue.
GOP PAR - Is the Total Gross Operating Profit for the period
divided by the total available rooms during the period.
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
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hotel performance, revenue, cost and profit statistics providing the deepest insight available into hotel operations.

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market segmentation metrics as well as distribution channel and source of booking analysis. It takes daily market
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BRIEFING DATA
UK Chain Hotels - Market Review
Currency: £ Sterling
The month of December 2016
Dec'16
Dec'15
Var b/w
78.7
73.8
4.9
ARR
160.97
146.57
9.8%
RevPAR
126.68
108.22
TrevPAR
185.20
Payroll %
GOP PAR
YTD'15
Var b/w
Rolling'16
Rolling'15
Var b/w
80.8
81.2
-0.4
Occ %
80.8
81.2
-0.4
ARR
154.26
152.65
1.1%
ARR
154.26
152.65
1.1%
17.1%
RevPAR
124.60
123.95
0.5%
RevPAR
124.60
123.95
0.5%
167.36
10.7%
TrevPAR
173.33
174.43
-0.6%
TrevPAR
173.33
174.43
-0.6%
23.9
25.4
1.5
Payroll %
24.6
24.5
-0.2
Payroll %
24.6
24.5
-0.2
84.18
74.71
12.7%
GOP PAR
78.16
80.22
-2.6%
GOP PAR
78.16
80.22
-2.6%
Dec'16
Dec'15
Var b/w
YTD'16
YTD'15
Var b/w
Rolling'16
Rolling'15
Var b/w
78.8
75.8
3.0
82.9
81.4
1.4
82.9
81.4
1.4
ARR
109.77
95.01
15.5%
ARR
114.15
105.27
8.4%
ARR
114.15
105.27
8.4%
RevPAR
86.49
72.05
20.0%
RevPAR
94.61
85.74
10.4%
RevPAR
94.61
85.74
10.4%
TrevPAR
138.68
124.50
11.4%
TrevPAR
135.67
125.57
8.0%
TrevPAR
135.67
125.57
8.0%
Payroll %
28.1
29.0
0.9
Payroll %
27.4
27.8
0.4
Payroll %
27.4
27.8
0.4
GOP PAR
49.42
40.63
21.7%
GOP PAR
52.02
46.43
12.0%
GOP PAR
52.02
46.43
12.0%
Dec'16
Dec'15
Var b/w
YTD'16
YTD'15
Var b/w
Rolling'16
Rolling'15
Var b/w
Occ %
77.3
74.0
3.3
Occ %
81.6
80.4
1.2
Occ %
81.6
80.4
1.2
ARR
79.33
76.45
3.8%
ARR
79.63
83.49
-4.6%
ARR
79.63
83.49
-4.6%
RevPAR
61.32
56.55
8.4%
RevPAR
64.97
67.09
-3.2%
RevPAR
64.97
67.09
-3.2%
TrevPAR
124.72
120.43
3.6%
TrevPAR
110.03
112.79
-2.4%
TrevPAR
110.03
112.79
-2.4%
Payroll %
27.9
29.6
1.7
Payroll %
29.7
29.5
-0.3
Payroll %
29.7
29.5
-0.3
GOP PAR
38.01
36.53
4.1%
GOP PAR
34.56
36.81
-6.1%
GOP PAR
34.56
36.81
-6.1%
LONDON
Occ %
EDINBURGH
The twelve months to December 2016
YTD'16
Occ %
CARDIFF
The Calendar year to December 2016
Occ %
Occ %
Occ %