Preliminary hotel figures for July show occupancy rose 10 per cent in London from 79.2 per cent to 87.1 per cent while it rose 6.7 per cent in the regions, from 75.3 per cent to 80.4 per cent.
Across the three to five star hotels monitored by BDO, room rates fell 1.4 per cent on the previous year to £59.09 in the regions resulting in a 5.2 per cent rise in room yield to £47.51.
In London the fall was greater in London - 13.6 per cent - to £138.20, resulting in a drop in room yield of 5 per cent to £120.36.
Robert Barnard, partner at BDO LLP, said the figures suggested the hotel sector was 'in good shape to take advantage of the nascent economic recovery.
"This is another strong showing by regional operators - their impressive performance during the first half of the year shows no signs of slowing down. I'd caution against reading too much into the drop in rooms yield in London, because the comparison is against the month in which the city began hosting the Olympics. The fact that occupancy is almost 90 per cent is a better indicator of the capitals current strength.
"The sector's fundamentals are strong. Some 12 months on from the Olympics, Londons position as a world class business and leisure destination is stronger than ever. Outside the capital, the lack of new development in recent years has helped operators to manage room rate and occupancy during periods of softening demand.
"It's important not to get carried away, but the sector has reason to be increasingly optimistic about its future prospects."
Hotel deals
The news of positive operational activity comes as property agents report an increase in the number of portfolio deals completed in the first half of the year.
Yesterday, Colliers International reported a 28 per cent rise in the number of transactions over the last year with some areas running out of properties for buyers, while business advisory firm Deloitte said total transaction volume had nearly doubled compared to the previous year.
Maryam Mohajer, senior manager in the travel, hospitality & leisure advisory team at Deloitte, said: "After a challenging 2012 with a lot of uncertainty and misalignment of expectations, the market was overdue a real acceleration in mergers and acquisitions.
"Since the beginning of 2013, we have seen more readily available debt financing and significant interest on the part of US private equity funds in particular. This led to £1.8bn of deals closing in Q1 2013 (many of which had been underway a considerable period of time). This is 10 per cent higher than all transactions together in 2012.”