Oil city hotels doing good business

Mar 14 2013

Hotels in Aberdeen outperformed almost all of their UK competitors last year, according to new analysis.

Collectively, the city's hotels enjoyed a 6.4% rise in occupancy rates compared with the previous year, the latest PwC hotels forecast found.

In contrast, the 24 UK cities studied experienced an average drop in occupancy of 1.5% over the same period.

Belfast, boosted by the new Titanic visitor experience and the MTV awards, was the only location to come out above Europe's oil and gas capital.

Aberdeen also performed well when other key measurements were analysed. Room revenues increased 14% while revenues per available room, known as RevPar, grew by 12% last year, putting it "significantly ahead" of other major locations such as London, Manchester and Edinburgh.

Bruce Collins, director in PwC's Aberdeen office, said the trend looks set to continue in the north-east city. "In most key metrics, such as daily rates, the percentage of rooms let and average revenues, Aberdeen outperformed most of the other UK cities," he said.

"Even in London, with the advantage of the Olympics, hotel occupancy declined by close to 2% year on year, although average room rates and revenues kept pace with inflation. Aberdeen's buoyant oil and gas industry provides a healthy stream of people to the city and this is positively impacting the hotel and leisure sector.

"The city is also a strong visitor destination and has two highly respected higher education establishments, so there is every reason to expect this trend to continue in 2013. There is also anticipation that conference and convention activity will continue to increase, adding to any off-season demand."

Professional services firm PwC said Glasgow and Edinburgh performed slightly below the UK in terms of room revenues but both cities saw a rise of over 3% in occupancy levels in the final month of last year, compared with December 2011.

But PwC said the prognosis for this year remains challenging. It predicts that demand for holidays abroad could be boosted following one of the wettest years on record.