The return of business travel is helping to boost the recovery of the hotel market, both in the UK and internationally, according to the latest Hotels.com Hotel Price Index (HPI).
Occupancy was running at more than 90 per cent in London where rates rose 10 per cent. The M4 Corridor has seen double-digit growth in room prices. Bracknell rates were up 18 per cent and those in Reading 15 per cent, reflecting increased corporate demand in the IT hub.
Overall, the average cost of a hotel room in the UK rose by a more modest two per cent in 2010, to £83 a night, according to the HPI.
David Roche, President of Hotels.com (pictured), said: “The 2010 story shows a market in recovery. Business travel, and the associated convention trade, is back and this increased demand has been driving up occupancy and hotel prices.”
Roche noted the high volume of promotions seen in the depth of the financial crisis had dried up, but said there were still deals to be had.
The Hotels.com HPI is based on real prices paid per hotel room for 110,000 hotels across more than 18,000 global locations.
HPI’s 2010’s figures show the first year-on-year increase since 2007 internationally. Room rates were up 14 per cent in Frankfurt, nine per cent in Amsterdam and eight per cent in Paris.
In the Asia-Pacific region, both business traveller numbers and prices have been surging, with Shanghai up 33 per cent, Hong Kong up 27 per cent, Singapore up 26 per cent and Sydney up 21 per cent.
In North America, New York was both the most popular overseas destination for UK travellers and among the most expensive after a 12 per cent increase took average room rates to £166 a night. Strong domestic business and a greater uptake of upscale hotel accommodation is credited by Hotels.com with driving the demand.
Las Vegas, a watchword for knockdown prices in the recession, saw a 20 per cent rise in rates to average £71 a night, as the convention business returned.
For UK business travellers, the Middle East featured two cities in the top three most expensive destinations, Muscat on £185 a night and Doha on £169, reflecting the small number of rooms and the strength of demand.
South America’s booming economy also saw huge increases in 2010 hotel rates in key business hotspots. Average nightly rates rocketed 41 per cent in Sao Paulo to £118 and 28 per cent in Rio de Janeiro to reach £139.
However, prices fell so low globally during 2009 after a 13 per cent drop that, despite last year’s increase, the average global rate is still the same now as it was in 2004.