London hotel profit down 17% as corporate guests stay away

The profitability of London chain hotels fell by 16.9% in February, according to the latest HotStats survey by TRI Hospitality Consulting. London hotels generated daily profit - expressed as income before fixed charges (IBFC) - of £47.75 per available room compared to £57.46 the same month a year earlier.

Total revenue and room revenue were down by 11.3% and 10.4% respectively in London. Average room rate dropped by 6.6% to £108.15 and occupancy was down 3.2% points to 74.7%. 'Targeted discounts stimulated leisure demand, which, all things considered, kept occupancy levels reasonably high. But this was not enough to compensate for the continuing loss of high-paying corporate guests, which combined with discounted rates, meant no interruption to the negative trend,' said Jonathan Langston, managing director, TRI Hospitality Consulting.