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London is set to see record additions to supply this year London is set to see record additions to supply this year

HotStats: UK Hotel Profits Hit by Rising Costs

UK hotels faced a challenging start to the year as escalating costs, particularly from payroll, completely wiped out the revenue growth recorded this month and led to a 3.9 percent year-on-year decline, concerning profit per room.

The latest poll from HotStats, a hotel benchmarking service, revealed that RevPAR growth during January was slight, at just 0.6 percent, and was entirely due to an 0.8 percent achieved average room rate increase, which offset the room occupancy 0.2 percentage point drop to 64.6 percent.

“January was the sixth consecutive month in which hotels in the UK have recorded a year-on-year decline in room occupancy,” said Pablo Alonso, CEO, HotStats. “I’m not sure it’s time to start panicking just yet as the drop has been fairly minor. However, with a record number of additions to supply, […] margins really need to be monitored.”