Scotland hotels hit hardest by recession

www.pkf.com

The UK hotel industry has been negatively affected by the economic downturn, and Scotland’s has been hit the hardest, a report issued on Monday revealed.

In 2008, occupancy rates fell by an average of 4.1 per cent in the country, and revenues were lower than in Wales and England.

The only “bright light” in Scotland was in Aberdeen, where revenues rose due to the region’s strong offshore industry.

Alastair Rae, of the business advisory firm PKF International, commented that the hotel sector should be prepared for further decline.

“The impact of the credit crunch increasingly affected the hotel sector during 2008,” he said, adding: “The decline in both occupancy and rooms yield in Scotland has increased in pace toward the year end and looks likely to continue into 2009. Reductions in both business and leisure expenditure are now having serious impact on the sector.”

A survey conducted by PKF showed that hotel occupancy fell in Aberdeen by 4.6 per cent, by 4.2 per cent in Edinburgh and by 4.3 per cent in Glasgow.

Aberdeen saw an increase in revenue, or room yield, of 3.4 per cent. In Glasgow, revenue fell by 2.0 per cent, and by 4.2 per cent in Edinburgh.

Rae noted that hotels in Edinburgh hotels are the highest-priced in the UK after London, at an average room rate of £71.90. Scotland reported the highest overall average room rate of £59.78.

Occupancy rates in Wales dropped by 2.5 per cent, and revenue declined by 1.7 per cent. In England, occupancy rates also fell by 2.5 per cent, with revenue down by 2.1 per cent.

Thanks to www.theherald.co.uk for the above quotes, for more information on this article please visit their website.

www.pkf.com