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Hotels in the capital saw a major improvement in performance in December, but properties outside London continued to flounder.
London hotels saw an increase of 23% in gross operating profit per available room.
Occupancy levels also increased by 5.9% last month, to an average of 77.3%, according to research by TRI Hospitality Consulting.
Jonathan Langston (pictured), managing director at TRI, said: "London hoteliers appear to have got the proposition absolutely right with the massive declines in profitability experienced in January 2009 now a distant memory."
But Langston warned that hotels in London would need to keep a watchful eye on costs in 2010.
Hotels outside the capital suffered a 2.2% decline in revenue per available room in December, as a result of a 5.2% in the price of the average room.
"The loss of business bednights in some of the UK's major cities has had a massive impact on the profitability of their hotels. Following the boom years in markets such as Manchester and Liverpool, underperformance and oversupply have led to huge declines in profitability in 2009," said Langston.
The gross operating profit per available room dropped by 22.7% in Manchester last year, and 26.4% in Liverpool.