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Olympic boost to luxury hotels

Hotel profits increased by 90% in the London full-service hotel market in the wake of the Olympics, according to last month's bulletin by international property consultant Savills and TRI Hospitality Consulting. Sat Bal spoke to London’s luxury sector hotels to assess their view. (12 Nov '12)

Savills/TRI Hospitality reports that the Olympic Games boosted performance with gross operating profit per available room (GOPPAR) increasing by 90% in Aug 2012, compared to the same time in 2011. Revenue per available room (RevPAR) was also up 41% in the same period.

Five-star luxury and West End hotels were cited as the best performers with 171% increase in GOPPAR year on year. This was off the back of a RevPar and total revenue per available room (TRevPar) of 64% and 65% respectively.

 “The phenomenal performance in August was a timely boost for the London hotel market, which until then experienced relatively weak revenue growth and no gross operating profit growth over the seven month period to July,” said Robert Seabrook, head of hotel transactions at Savills. 

David Bailey, director at TRI Hospitality Consulting, added: “The hosting of such a fantastic Olympic event can only enhance London’s reputation as a world-class destination. However, looking to the immediate future, revenue and profit growth in the London full-service hotel market is slowing and, with the exception of the August Olympic period, is virtually flat.”

 

 Red Carpet elicited feedback from the hotel sector...

 

Grosvenor House, Park Lane  

“The 2012 Olympics has been an incredible year for the capital and for Grosvenor House, as we enjoy the effects of our very own Olympic legacy.

“As a LOCOG hotel during the Games, we were honoured to host the high profile International Olympic Committee (IOC) Session, a three day meeting in the days leading up to the opening ceremony, with all 205 Olympic nations represented, including IOC President Jacques Rogge and London 2012 chairman Lord Coe. The Paralympic Ball at the end of the Paralympic Games was also held in our Great Room and double Olympic gold medallist Mo Farah had his inaugural Mo Farah Foundation Ball here. We still have the British Olympic Ball on Friday 30 November to come.

“In the last two to three years we have enjoyed strong demand from the US and based on the corporate and incentive meetings business from the US that we have already secured, we see this trend continuing in 2013 and into 2014. In addition, this year we have secured large international group bookings from China, South America and Australia, which is a really positive indicator that demand to come to London is present and I am confident that the Olympics and the positive profile that it has generated for London is a factor.”

Vicki Richards, Director of Sales & Marketing, Grosvenor House, A JW Marriott Hotel

 

The Dorchester, Park Lane

“The Dorchester renovated 22 new suites this year and was fully booked over the period of  the 2012 Games welcoming a mixture of sponsors, team federations, corporate hospitality and  leisure travellers.  

“Dorchester Collection had also opened two new hotels in time for the Olympics - Coworth Park, a luxury country house hotel and spa near Ascot, and 45 Park Lane, a contemporary art deco hotel, just metres away from The Dorchester.  Both experienced strong levels of business, particularly from the United Kingdom and United States.”

Rosanna Fishbourne, Area Director Of Communications

 

 

51 Buckingham Gate

"The Olympics and Paralympics were a fantastic business driver for 51 Buckingham Gate. Over the whole period we only accepted long stays of a minimum of 14 nights, and started accepting bookings up to 12 months in advance. We were the hotel of choice for a large number of dignitaries, celebrities and other high profile guests so security was of absolutely paramount importance. Our great location worked in our favour too, as our proximity to Buckingham Palace and Horse Guards Parade made the hotel a particularly attractive prospect for visitors attending Olympic events such as the Beach Volleyball.

“We've also worked hard to ensure bookings remain strong in the aftermath of the Olympics and have teamed up with Hamleys to offer a new initiative this Christmas.  From 23 November to 22 December, families can arrange to meet with Father Christmas and his elves at the toy shop for an evening’s entertainment including dinner, photographs and goody bag to take home. The whole package costs £1000 and is based on a family of two adults and two children staying in a two bedroom suite, which costs £495 a night. This month also sees the launch of our brand new Cinema Suite, designed by acclaimed Indian designer Sabyasachi Mukherjee. At once a journey through world cinema and an ode to tradition, the 1,832 square foot, two bedroom suite, with dining room, study, powder room and kitchen, has been designed in tribute to the history of film and takes inspiration from motion pictures across the globe."

Semiha Askin, Director of Sales & Marketing, 51 Buckingham Gate

 

 

InterContinental Hotels Group (IHG)

InterContinental’s Holiday Inn and Staybridge Suites were the main story for us since they overlook Olympic Park in Stratford. We helped to run the athletes' village within the Park. We also accommodated LOCOG officials so occupancy was very high. Having our two new hotels next to the Park also allowed us to showcase our hospitality among key stakeholders.

LOCOG officials also stayed at InterContinental, Park Lane and our Q3 RevPar for Park Lane was up 13% with occupancy increased by 5.4%. We had 3.9% RevPar growth for the third quarter with London RevPar up 5.8%.  

We became event sponsors for long-term reasons and to drive interest in the brand. It wasn’t just about selling rooms. It was about creating an enduring legacy and sponsorship did create a halo effect for our brand.  Looking to IHG’s global future we’re excited about the opening of our first ‘wellness’ brand (EVEN Hotels) in Manhattan in 2014.

 IHG

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