London hotel occupancy exceeds 2008 levels

London hotel occupancy figures for July 2009 exceeded levels achieved in the same month last year, according to the latest HotStats survey by industry experts, TRI Hospitality Consulting.

The capital's hoteliers successfully drove volume to an historically high 88.6% for July by further discounting room rates. Achieved average room rates remain below levels achieved last year at £115.65 (EUR 131.6 mln), a drop of 13.1%.

'The increase in volume and relatively strong rate performance compared to last year is all the more remarkable given the lack of the biennial Farnborough Show in 2009,' says Jonathan Langston, managing director, TRI Hospitality Consulting.

The London hotel market in July is driven by strong Middle Eastern demand, which generally continues until September. Primarily upmarket hotels in the West End and Knightsbridge strongly benefit from this demand sector.

Demand is driven by the extended average length of stay of Middle Eastern visitors of around 14 days, compared to the London leisure sector average of just over five days.

Compared to July 2007 (the last comparable period without Farnborough demand), occupancy levels in 2009 improved marginally by 0.1 percentage point and achieved average room rates increased by over 2.7% or £3. Given the current economic climate, the outperformance of the London hotel market over the comparable period in 2007 demonstrates the capital’s strong market performance.

In the seven months to July 2009, average occupancy levels in the capital were down 2.2 percentage points at 78.9% and achieved average room rates dropped by 8.4% to £109.47, compared to the same period last year.