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'Solid growth' for hospitality boosts Glasgow hotels

HOTELS in Aberdeen remained buoyant in January, while the sector in Glasgow also enjoyed strong year-on-year growth in revenues, a survey has shown.

The survey, which covers three and four-star properties and was published yesterday by accountancy firm BDO, signalled a solid start to the year for the hotel sector in Scotland.

Revenue per available room at Scottish hotels in January was up by 9.9% on the same month of last year at £35.25. This measure, also known as rooms yield, is calculated by multiplying occupancy by the average room rate achieved.

The hotel rooms yield figure for Scotland was in January again significantly greater than that for England, which came in at £31.44. Rooms yield for hotels in Wales was £23.76.

Aberdeen hotels continue to be boosted by oil and gas sector activity.

Rooms yield for Aberdeen hotels in January was up 9.7% on the same month of last year at £58.96.

This year-on-year rise was achieved even though occupancy, at 64.7%, was adrift of a rate of 67.1% for January 2013. Higher room prices more than offset the impact of lower occupancy on yield.

BDO noted that the rooms yield figure for Aberdeen was far ahead of anywhere else in the UK outside London.

For Glasgow hotels, rooms yield in January was up by 15% on the same month of last year at £34.90. Occupancy in the Glasgow hotel sector came in at 63.8%, up from 59.2% in the same month of 2013.

The hotel sector in Edinburgh achieved a 5.1% year-on-year rise in revenue in January, to £35.85.

Occupancy at Edinburgh hotels came in at 58.5%, an improvement on a rate of 55.7% for January 2013.

Rooms yield for hotels in Inverness came in at £24.29 in January, up by 3.7% on the same month of last year.

This reflected a rise in room rates. Occupancy in Inverness hotels in January, at 55.7%, was down slightly from a rate of 56.7% in the opening month of 2013.

BDO partner Alastair Rae said: "The first figures of 2014 clearly indicate that the hotel sector is continuing to experience growth. The star performer remains Aberdeen, where revenue exceeded everywhere outside London in the UK by some considerable way."

"Given the market in Aberdeen is not seasonal the fact that this was January made no difference to the performance of the sector."

He added: "For Edinburgh and Glasgow, there was also some solid growth in occupancy levels, which resulted in improved revenues for both cities. January is usually a fairly quiet month but both cities held up well."

Mr Rae predicted Scotland's hospitality sector would continue to improve as consumer confidence returned, and both business and leisure customers began to travel more.

He said: "It is still early days in the recovery but there are clear signs that the hotel sector is consistently improving."

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