According to CBRE Hotels, London hotels recorded a 2 per cent year-on-year increase in profitability last year despite a 4 per cent increase in room supply and a decrease in the number of tourists visiting in December.
Joe Stather, CBRE Hotels Intelligence Manager EMEA said the ‘explosion in demand’ for rooms from overseas visitors coming to the UK to watch the rugby in October pushing average room rates up to £160, helped banished fears of a bad year.
“By Q3 2015, economic uncertainty in the key source markets of China and Russia, plus a 4 per cent increase in new hotel stock throughout the year meant that the London Hotel market was potentially facing negative growth by the end of 2015,” he said.
“In Q4 however, with over 2.5 million visitors coming to the UK to watch the Rugby World Cup, and 3 out of the 13 rugby stadia being in the capital, there was an explosion in demand for London’s hotels, returning the sector to profitability by year end.”
Record visitor numbers
While London businesses benefitted from an increase in visits in October due to the Rugby World Cup, the latest figures from the Office for National Statistics International Passenger Survey show that the previous three months were also positive.
Between July and September there were more than 5.2 million visits from international tourists to the capital, an increase of 5.9 per cent against the same period in 2014, a record number according to statistics.
Visits were also up from domestic visits with 9.3 million trips being made to London in the first nine months of 2015.
Gordon Innes, CEO of London & Partners said: “Today’s visitor numbers show that London is more attractive than ever. The tourism industry is a key pillar of the capital’s economy providing great employment opportunities, including many entry level jobs, for Londoners and investment right across the city. That’s why we work tirelessly with our partners, museums, attractions, hotels, restaurants and many more to ensure that London remains the destination city of choice for overseas visitors.”