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The CEOs of Six Senses and The Brgenstock Collection discussthe luxury resort of the future
Wimberly Interiors present a stunning 7-page portfolio of hotel design trends
The 2014 hotel outlook around the world:45 country reports from Horwath HTL
Our trend spotters on asset management, sustainability,digital marketing, tourism and revenue management in 2014
Industry observations from our academic partners Cornell, Lausanne,
Hong Kong Polytechnic and ESSEC
2014HOTELYearbookFORESIGHT AND INNOVATION IN THE GLOBAL HOTEL INDUSTRY
www.hotel-yearbook.comThis e-publication may be ordered online | 19.50
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At Horwath HTL, we ocus one hundred percent on hotels, tourism and leisure. With over two hundred and ify
proessionals world wide, our network can draw on a tremendous amount o international experience and local
knowledge that gives us, and our clients, a unique advantage.
We offer a broad range o advisory solutions that covers the whole cycle o the hotel product, starting with planning
and development, on to asset management and operational advice, to transactional and inancial restructuring. At any
stage, Horwath HTL will add value to your project and ensure that you receive the very best support every step o the
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Hotel, Tourism and Leisure
COUNTRYREPORT
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2013 SNAPSHOT
UK GDP recorded the fastest growth for three years,
with economic output rising by 0.8% between July and
September and 2013 growth forecast at 2.4%.
London performance has been volatile following the
Olympic year, although demand has continued to outstrip
supply with year-to-date October 2013 occupancy at
82.9%, a 2.2% increase against the same period last year;
and ADR at 137.72 (a 2.8% decrease), resulting in RevPAR
of 114.20 (a 0.6% decrease) according to STR Global (the
source for all performance data here).
The regional hotel market is fully recovering, with 10
months of consecutive RevPAR growth, with year-to-date
October 2013 occupancy at 73.5%, a 3.9% increase; and
ADR at 59.98, a 0.6% increase, resulting in RevPAR of
44.09, a 4.6% increase (versus the same period 2012).
Top five performing cities were Cambridge, Oxford,
Aberdeen, Bath and Edinburgh, while the bottom five were
Nottingham, Southampton, Newcastle, Leeds and York.
Transaction volume increased significantly, with
2.4 billion recorded in the first nine months of 2013,
representing an almost two and a half-fold increase on
2012 and the highest level since 2007, according to Savills.
Portfolio transactions returned to the market in force in
2013 as a result of bank driven sales. In addition, there
has been increased transaction activity in the regions
and limited drive to sell London assets, despite the vastinternational investment appetite.
New supply is focused largely on the budget and
4-star markets, with the vast majority being branded.
Development has been fuelled by leases, London and
allowances. In the regions, Birmingham, Manchester,
Glasgow and Edinburgh lead supply pipelines.
BUSINESS SCENARIOS FOR 2014 AND BEYOND
London will continue to attract tourists worldwide, and its
ADR is expected to recover, resulting in a RevPAR growth of
4% while consecutive GDP and GOPPAR growth recorded inthe regions in 2013 provide good foundations for a positive
2014, with 1.9% RevPAR growth forecast (forecasted by STR
Global in conjunction with Tourism Economics). While it
remains a challenge to convert rate growth down to the GOP
level, the corner appears to have been turned and regional
hoteliers should start to see this happening.
The rise of the OTAs has been a much-discussed topic which
has been the cause of concern for some hoteliers due to
commissions of up to 25% of the room rate. The extent of
the OTAs advertising and marketing resources suggests that
they will go on dominating at the expense of owners profit
margin. As a result, the hotels reaction should be a blend of
cooperation and competition.
Investment volume is likely to be slightly below that of 2013
despite more realistic price expectations on both sides and
transaction speed increasing. Further portfolio rationalization
is expected, although there is concern regarding investors
exit strategies for any regionally-led portfolios that come to
market. We will continue to see banks oload in the regions.
Private equity funds are likely to continue their interest in UK
hotel assets, particularly outside London, since the downward
yield pressure in the capital makes the regional returns more
attractive and IRRs are more aligned to their expectations.
Additionally, an increase in new, innovative hotel concepts
such as CitizenM, ZHotels, Moxy Hotels and Premier Inn Hub
is likely. These focus on high design and technology in small
spaces and aim to oer clients aordable quality, ideal for
city-center locations.
Mid-market hoteliers are likely to continue to find their space
more congested and competitive with pressure from modern
budget branded tech-friendly properties attracting customers
away from the tired products pervading this segment. New
branded products such as Hampton by Hilton and Alo are
trying to rebalance this.
The serviced apartment and hostel market is expected to
gain further traction, with more branded product appearing
and investors realizing the cost/return benefits in an under-
supplied and under-branded market.
We expect a continued increase in franchisees.
Lastly, in the short- to medium-term, there is concern
regarding a capex time bomb, where hoteliers have notinvested what is required in their hotels aer the lengthy
financial crisis.
UNITED KINGDOM byAlexandra van Pelt i
Country reports are brought to you byHorwath HTL
CO
UNTRYREPORTS
Alexandra van Peltis an Associate Director at Horwath HTL (UK).
She assists the team with development, valuations and asset
management assignments. Before joining Horwath HTL, she worked
in the hotel team at DTZ and at Marriott Vacation Club International
in the Resort Development EMEA team. Alexandra started her career
in hospitality at Orient-Express Hotel de la Cit, Carcassonne.
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The CEOs of Six Senses and The Brgenstock Collection discuss the luxury resortof the future
ESPAs Sue Harmsworth on the coming changes in the global hotel spa industry
The 2014 hotel outlook around the world: 45 country reports from Horwath HTL
Our trend spotters on asset management, sustainability, digital marketing,tourism and revenue management in 2014
Industry observations from our academic partners Cornell, Lausanne, Hong KongPolytechnic and ESSEC
2014HOTELYearbookFORESIGHT AND INNOVATION IN THE GLOBAL HOTEL INDUSTRY
www.hotel-yearbook.com
This e-publication may beorderedonline| 19.50
For more country reports by Horwath HTL
Click hereto purchasethe full edition ofThe HOTEL Yearbook 2014
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