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Scottish hotels outperforming outlets across UK

by Simon Bain
© The Herald
Originally published: 09.12.2009
The Scottish hotel sector is outperforming most of the UK, thanks to its leisure and tourist markets holding up well during the summer, according to the latest monthly survey by business advisers PKF.

The 2.1% average drop in occupancy at Scottish hotels in October against the previous year compared with a 3.7% drop in England, though Wales achieved a 1% rise. Similarly on rooms yield, the industry measure of revenue, Scotland was down 9.1% against 11.7% for England, with Wales up 1.5%.

Only Edinburgh posted a year-on-year rise in October, with a 3.8% rise in occupancy rate and a lower fall in rooms yield of 4.3%.

In Glasgow occupancy fell 1.9% and yield 10.4%, while Aberdeen suffered bigger falls of 12.3% in occupancy and 16.9% in revenue.

Rooms yield in Edinburgh held up at £62.86, the highest outside London.

Alastair Rae, a partner at PKF, said: “The figures for occupancy and rooms yield in October indicate that hotels are sacrificing room rate in order to maintain occupancy levels.

“This is clearly a reaction to a drop in demand and has been the case for a few months.

“Whilst the reduction in rooms yield is high for October it should be noted that, for the year to date, Scotland has only had a 0.8% drop in occupancy and a 5.5% fall in rooms yield.

“This compares favourably with the rest of the UK where England excluding London, for example, is down 6.6% in occupancy and 13.8% in rooms yield.”

He said Scotland’s average rooms yield at £52.48 was still more than £10 higher than anywhere else outside London so the percentage fall was from higher levels. Macrae added: “Edinburgh’s hotel sector remains robust with occupancy at 82.5% which is high considering the period covered is not part of the main tourist season.” He said that the fall in Aberdeen appeared gloomy but the city was doing relatively well for the year to date with a 7.7% drop in occupancy and a fall of 3.1% in rooms yield – only the second smallest decrease in the UK outside London. In Glasgow, occupancy had fallen by 3.6% for the year to date and rooms yield by 7.6%. Rae said that the monthly figures might appear depressing but he went on: “The figures for the year to date indicate that hotels in Scotland are not flourishing, but are at least outperforming their counterparts in the rest of the UK.”

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