Hotel Industry in UK Starting to Come to Life

by Alfie FEATHERSTONE on November 10, 2009

The United Kingdom has been hit hard by the global recession in which it is currently mired.  The five consecutive quarters of downturn ranks as one of the worst recessions in modern history.  Particularly affected by the downturn has been the travel and tourism industry, which has seen its occupancy rates and revenue per available room drop dramatically over the last two years.  This has caused some in the industry to turn to drastic measures to cut costs and raise profits.  There have been closings as well as reports that some hotel chains will be cutting stars, amenities, and staff in an effort to cut costs.  However, according to one report, the worst may soon be over.

According to a report issued by Millennium and Copthorne Hotels PLC the worst of the downturn for hotels may be over very soon.  The hotel company reported that their profit per available room has stopped declining so rapidly and that bookings are starting to pick up.  Revenue per available room, or revpar, has long been the standard that hotels use to gauge whether or not their business is going well.  Revpar has been down over the last year to levels not seen in nearly a decade, as hotels were forced to cut room rates in an effort to draw more customers.

Millennium and Copthorne Hotels PLC was encouraged by the slow but sure re-emergence of corporate sponsored meetings and events, which have long been the backbone of hotel business.  Corporate and business travel, as well as conferences have been down over the last year but are slowing starting to pick up.

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