GERMAN hotel group Leonardo Hotels has signalled further confidence in the Scottish hotel sector with the opening of its first property north of the Border.

Leonardo, which has a hotel at Heathrow Airport, has invested more than €7 million in a former Premier Site near Haymarket station. The four-star Leonardo Royal Hotel Edinburgh fits in with the Berlin-based operator’s strategy of creating “non-standardised hotels that are defined by their own regional character, special local flair and bespoke style identity”.

With the hotel occupancy rate for Edinburgh and Lothians in 2016 at 82 per cent, the group sees the capital – and Scotland – as a prime location as it forges ahead with its European expansion plans. “Our business model is never to open just one hotel in a new area,” said Daniel Roger, managing director of Leonardo Hotels Europe.

Loading article content

“Since 2006, we have opened 63 hotels and are already reviewing our plans for further growth in Scotland.” The group has more than 80 hotels in 40-plus locations and has an “instinct for attractive and economically strong locations with buildings in first-class condition”, Mr Roger added.

Aiming to capitalise on its location near tram stops and the station, Edinburgh International Conference Centre and the under-construction commercial development The Haymarket, Leonardo hopes to appeal to a wide range of leisure guests along with a growing corporate and business tourism market. The 282-room hotel also has parking for 90 cars.

In its last annual results published in March 2017, Leonardo Hotels reported sales of €305m with annual revenues up 12.5 per cent on the previous year. Mr Roger added: “We are a chain hotel, but we are as far removed from a chain hotel as possible.”

A recent survey revealed that both Edinburgh and Glasgow achieved solid year-on-year rises in revenue per available room (revpar) in the opening three months of this year.

The report, published by consultancy AlixPartners, hotel market intelligence specialist AM:PM, consulting organisation HVS, and global data benchmarking and analytics provider STR, showed that the Edinburgh hotel sector achieved a seven per cent year-on-year rise in revpar in the first quarter while Glasgow’s posted a four per cent year-on-year rise. Revpar is calculated by multiplying the occupancy rate by the average room price.