Posted on Monday 11 March 2013 by Ulster Business
Business advisors PwC compared hotel data across 24 UK cities and found that, while average UK hotel occupancy fell by 1.5% in the 12 months to December 2012, Belfast hotels collectively enjoyed a 13% increase in occupancy over the same period.
That was the biggest increase in average hotel occupancy amongst any of the 24 cities surveyed; more than twice that of Aberdeen, the next best performing city, where average hotel occupancy grew by 6.4%.
PwC said Belfast's stellar performance was boosted by an estimated 700,000 visitors to Titanic Belfast – of whom 65% were from outside Northern Ireland.
A variety of events and attractions, ranging from the 2011 MTV Europe Music Awards to the Irish Open golf and the opening of the new Causeway Visitor Centre, had kept Belfast in the headlines as a tourist destination in late 2011 and throughout 2012, the firm commented.
PwC partner and private sector leader, Kevin MacAllister (pictured), said: "In most key metrics - like daily rates, the percentage of rooms let and average revenues, Belfast hotels outperformed most of the other cities, including London.
"Even in London, with the advantage of the Olympics, hotel occupancy declined by close to 2% year on year, although average room rates and revenues kept pace with inflation.
"Belfast enjoyed a remarkable year in 2012 and the indications are that visitor traffic will continue through 2013, with an anticipated increase in conference and convention activity, adding to the off-season demand."
The PwC review of 2,850 hotels in 24 UK cities is based on data from STR Global's database and includes 24 leading Belfast hotels, accounting for over 3,100 rooms.
During 2012, Belfast hotels increased overall occupancy by 13%, but the proportion of hotel sales generated from room revenues (Room Rev) increase by almost 18%, while revenues per available room (RevPAR) grew by 17%. In each case these metrics were well above the UK average for 2012 and even significantly ahead of London, Manchester, Edinburgh and Cardiff.
Across the UK, average occupancy for hotels in the 24 cities declined by 1.5%, while Room Rev grew by 4.4%, with RevPAR increasing by just 1.4%.
Looking to 2013, the PwC forecast suggests that international tour operators have put London back in their programmes after reportedly leaving the capital out in 2012, due to concerns about the Olympics and overcrowding.
However, the prognosis for London is for another year of declining accommodation levels, average revenues and RevPAR, partly due to the continued tough economic climate and to the steep 6.5% (7,700 rooms) increase in hotel rooms in the capital in 2012, with a further 4,600 rooms set to open this year.
In most UK regions, the prognosis is equally challenging. With 2012 having been the second wettest year on record, demand for holidays outside the UK is likely to be boosted as UK citizens head abroad in search for some guaranteed sunshine.
In terms of supply, around 8,500 new rooms are in the UK pipeline for 2013, putting further pressure on revenues and margins, particularly in cities like Birmingham, Newcastle, Bath and Liverpool where significant numbers of new rooms and hotels will come on stream.
But Kevin MacAllister predicted that Belfast may enjoy another year of growth.
"There is no substantial pipeline of new rooms to increase competition shrink margins in 2013, while Titanic Belfast, the World Police and Fire Games and a number of new events should keep the city amongst potential visitors' target destinations," he said.
"If the anticipated conference bookings bolster non-peak occupancy and the security situation remains calm, Belfast's hotels could deliver yet another year of steady growth."