Slowdown not meltdown' for hotel sector

UK hotel occupancy levels are forecast to stagnate this year as corporate budgets tighten, according to a Pricewaterhousecoopers (PWC) report. However, the report, Hospitality Directions: UK Hotel Forecast, says hotels are “relatively well placed to cope” with global financial uncertainty and economic slowdown and, are “unlikely to experience a meltdown” in the next two years. The report forecasts that occupancy levels in UK properties will “remain flat or may even see some small declines”. Revenue per available UK room is predicted to grow by 4.1% this year and just 3.6% in 2009. London’s growth spurt is tipped to slow, with revenue per available room in 2008 predicted to grow 6% but just 4.4% next year. PWC head of hospitality research Liz Hall said hotel operators would have to become “more aggressive with sophisticated revenue management strategies and stealth charges” as room rates fell off. “A tightening of corporate travel budgets and policies and more careful consumer spending will make it harder to attract both the consumer and the corporate pound.” PWC partner and UK leader of hospitality and leisure added that: “While the industry will feel the pinch from the latest economic situation, it is coming from a good position with some excellent products in the market. UK hotels, overall, should still see reasonable growth through to the end of 2009 but the economy is very fragile at present and another tilt could have a more significant impact on the sector.”

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