Hotel market upturn set for the end of 2002

Worldwide corporate travel was steadily being reduced throughout 2001 in response to the threat of recession and is not just a result of 11 September, according to a survey by BTI UK Hotel Service. The findings showed that worldwide hotel rates have risen by nearly 3%, while levels of demand have dropped by 6% and overall 15 out of the 49 countries surveyed have seen rates fall. The survey was carried out among 7,500 of BTI’s clients (business travellers and C&I buyers) from January to December 2001. "It is clear from the results that corporate travel was being reduced a long time before 11 September and clients were already beginning to reassess their travel policies in response to the threat of recession," said BTI general manager Margaret Bowler. "This was noticeable in London where there was a significant reduction in five-star bookings and a greater willingness to stay in mid-market accommodation." In New York, the first quarter saw demand for hotel rooms up 16% on 2000 levels. By the second quarter though, demand had decreased 16%. The effect of 11 September can be seen in the third and fourth quarter as the city took a 29% drop in room nights booked. The survey also revealed South Korea was the most expensive country with an increase in room rates of more than 100% (from £116.47 in 2000 to £249.29). However, BTI predicts a market pick-up soon. "Just five weeks into 2002 already saw an upturn in the hotel market compared with November last year," said Bowler. "Our clients are travelling more, holding more meetings and conferences and generally seem to be treating 2001 as a closed book and 2002 as a new chapter."

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