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‘Staycations’ Boost Demand for UK Hoteliers

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According to Hotels, a new Market Update from market intelligence provider Key Note, the value of the UK hotel market amounted to an estimated £14.6bn in 2011, representing an increase of 4.5% on its value in 2010 and reversing the recent trend toward decline.


Growth in the UK hotel market is largely driven by the performance of hotels located in London, which experiences significantly higher rates of occupancy and revenue per room than the rest of the UK. Rapid expansion in the budget hotel segment has also contributed to recent growth, with competition between the two major players, Premier Inn and Travelodge, driving the majority of growth in this segment.


The UK hotel market has experienced increased demand in 2011, attributable to a rising number of international tourists, following 3 consecutive years of declining overseas visitors. The market has also benefitted from high levels of domestic tourism by UK residents. This trend, which became extremely popular in 2009, following the impact of economic recession, has provided the UK hotel industry with increasing demand, with the majority of these domestic vacations lasting less than 3 days, making hotels the ideal accommodation for such trips.


In 2012, the hotel industry is expected to receive a boost, with the London 2012 Olympic and Paralympic Games expected to provide a massive influx of international visitors to London and other Olympic venues. Key Note forecasts that this -- along with a boost in domestic tourism for the Queen's Diamond Jubilee celebrations -- will provide significant growth in the UK hotel market in 2012. However, with many hoteliers expecting a 'hangover' effect following the Games, Key Note forecasts that growth will be subdued in 2013, with growth subsequently rising year-on-year as the UK economy improves.



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Press enquiries: Jack Sykes at Key Note at or 0845 504 0452. Press/review copies of the report are available on request.