| | HRG UK's 2007 half year
hotel survey has
revealed continued
growth and a strong
average rate performance
for the hotel industry
worldwide. Moscow once
again achieved the
highest average room
rates, alongside
significant growth in
the rapidly developing
markets of Dubai and
Mumbai.
Margaret Bowler,
director global hotel
relations at HRG,
commented: "Europe has
seen strong increases,
and rates in the Middle
East and Asia have also
risen. As these two
particular markets have
yet to reach full
maturity, we expect to
see the trends continue
over the foreseeable
future. Indeed, as
economic investment in
each local economy
increases, we may even
see a significant
increase in the pace of
growth."
Another key finding | |
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| | of the survey is the
ever-growing importance
of booking in advance,
particularly for
travellers looking to
secure the best rates.
Last minute bookers are
increasingly suffering
from inflated rates in
the most popular
locations, and companies
need to ensure that they
have negotiated last
room availability in
their corporate rates to
avoid this.
Moscow has retained
its position as the
destination with the
highest hotel rates for
corporate travellers,
with the price of the
average room increasing
by 7% compared with the
same period from 2006.
In Europe, Paris
retains its place in the
top five most expensive
destinations, slipping
one place from its 2006
ranking with rates
continuing to grow by
5%. London fell from the
sixth to the ninth most
expensive city despite | |
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| | also posting a steady 5%
increase, reflecting the
extent of growth in
Europe.
Outside of Europe and
North America, of the
top ten, Hong Kong and
Bangalore saw average
room rates fall.
Significantly, Bangalore
witnessed room rates
decrease by 7% as the
economy experienced a
slowdown due to a
plateau in its growth as
a base for corporate
outsourcing and
international call
centres. With many
companies having already
moved their business to
Bangalore, hotel
industry rates are
starting to settle to
more sustainable
figures.
The lack of
availability in key
destinations continues
to be an issue in the
current strong market
and the evidence
suggests that corporate
travellers remain unable
to significantly change | |
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| | their booking patterns
and timescales. In the
first six months of 2007
almost 10% of all
bookings were made on
the day of arrival, a
marginal increase on the
same period in 2006
(9%).
The majority of
bookings (28.8%) are
continuing to be made
between four to seven
days prior to arrival,
which increases the risk
of clients paying rates
higher than those
contracted or having to
upgrade to superior room
types – resulting in a
significant cost to the
traveller. High levels
of occupancy tend to
lead to hoteliers
closing out client
specific negotiated
rates to achieve greater
yield, except where
allocations have been
put in place or rooms
have been pre-purchased.
As a consequence of
customers continuing to
leave bookings to the
last minute, 28% of all | |
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| | bookings were 'denied'
during the six months to
June 2007.
The data would
suggest that hotels are
not delivering agreed
client rates, preferring
to accept business at
higher rates. This is
particularly the case in
cities where demand is
high, and where
corporates have
negotiated what appear
to be highly competitive
rates without last room
availability based on
expected large volumes
of bookings in the
belief this will drive
down costs.
Bookings denied due
to their lack of
availability on the
Global Distribution
Systems, which reached
30%, demonstrates the
current strength of the
hotel industry as seen
in both increased
occupancy and average
room rates globally.
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