London hotels are likely to see increases in revPAR over the next two years, accommodation expert Liz Hall said.
Hall, head of research at PwC for hotels, meetings and serviced apartments predicted revPAR (revenue per available room) in the UK capital would rise by 8.3% this year and 9.7% in 2012.
This follows an 11.4% rise last year which signalled a recovery in the hotel industry after the disastrous recession-hit year of 2009.
Hall, speaking at the ITM annual conference at Heythrop Park, Oxfordshire, said she expected a rise in average daily rates (ADR) in London properties this year of 6.1% and of 7.9% in 2012 while occupancy in these two years was likely to increase by 2% and 1% respectively.
Hall said the rate of growth in London would start to slow up by late 2011 as ADR also slowed because of new hotels, many built for the Olympics Games next year began to come onto the market.
She said the “high scenario” for London in 2012 when it hosted the Games would be just over 908,000 extra visitors. This compares with Athens which attracted 660,000 new visitors when it hosted the Games in 2000.
She said 4,000 new rooms were expected to be open for the Games with a further 7,000 under construction. These included new brands not previously available in London like Corinthia, W and Bulgari.
But she warned that while business travellers were returning, the recovery so far may not be as deep as first imagined and it was also “uneven” across the world with Asia Pacific faring much better than Europe or North America.
Hall said the recession had also forced corporate to be more savvy in buying rooms with many researching prices.
“Buying clever is the norm now. Business travellers have a cautious mindset and want everything included in the price. For example they now refuse to pay for wi-fi,” she told delegates.