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Olympic demand applies to all sectors

ufi ibrahim is chief executive officer of British Hospitality Association

European transactions increase

International consulting firm HVS has revealed European hotel industry investment activity showed signs of improvement last year, fol- lowing a 9 per cent growth in total transaction volume. HVS London’s European


laims that London hotel rooms during the Olympic Games are overpriced are now appearing in national newspapers, but it’s

surely not surprising that the capital’s hotel rates are at a premium level when the world’s largest sporting event comes to town? People forget pricing is demand-led and

tariffs will grow when demand rises. A recent survey in one newspaper compared Olympic prices with those of 23 December last year – when most London hotels have such low occupancies that some are nearly closed – this is clearly not a valid comparison. London will be very busy during the

Olympic period. A recent BHA study of 33 hotels representing 10,000 London rooms shows they are already 78 per cent full for the period and expect to be no less than 95 per cent full. At least eight are already 100 per cent full. With such demand, rates inevi- tably increase but they will eventually find a level commensurate with the demand. Will there be some displacement of nor-

mal visitors who want avoid London because of the Games? Yes, there will. Some com- mentators even suggest that prices charged this year will deter visitors in subsequent years. But there is no evidence to suggest this. Te ‘high prices’ allegedly charged by Beijing hotels for the 2008 Games have not stopped more visitors than ever from visit- ing China. Te Games will also introduce new visitors to the UK who would not other- wise have come and who may revisit later. However, comparison with Beijing is not

realistic. London has more than 110,000 rooms, with a further 75,000 in the south east – all within easy commuting distance. Tis is more than any other Olympic host city has ever been able to offer; although central London will be full, there is clearly plenty of capacity outside the capital. Te Games are a highly commercial event

and the hotel sector is a commercial indus- try. Te rates charged will ultimately depend on the strength of demand, as they do with the pricing of airline or rail tickets, package holidays and every other area of commer- cial activity. Te law of supply and demand applies to all industries.


Hotel Transactions study saw total volume grow to €7.1bn (£6bn) compared with €6.5bn (£5.5bn) in 2010. However, the report also found activ- ity continued to remain well below the 2006 peak of €20bn (£17bn), as well as the 10-year average of €9.9bn (£8.4bn). Te increase in activity last year has been

Tornbury Castle Hotel was one of von Essen’s properties sold last year Charles Human, managing director HVS

attributed to improved demand in both the leisure and business markets, which has made the sector more attractive to investors. Meanwhile, a number of distressed assets

came up for sale over the past 12 months, such as the von Essen portfolio of 28 properties.

Hodges Ward Elliott – the group’s hotel bro- kerage and investment banking arm, said: “In 2011 there was a growth in both trading performance and hotel values across Europe indicating that recovery is under way.” Details: (PDF)

Accor, Millennium and Copthorne report 2011 results

Te Ampersand Hotel, one of London’s origi- nal Victorian boutique properties, is to reopen in South Kensington following an extensive redevelopment and renovation programme. Dexter Moren Associates have overseen the exterior and interior design of the 111-bedroom

property, which spans 5,665sq ſt (526sq m) and will boast a Technogym-equipped gym. Elsewhere, the Apero dining concept will

also be among the facilities. Te Ampersand Hotel will open ahead of the 2012 Games. Details:

IHG unveils wellness-focused hotel brand

InterContinental Hotels Group (IHG) has launched a new wellness-focused hotel brand designed to meet con- sumer demand for “healthier travel at a mainstream price”. EVEN Hotels, which IHG

says is a first for the global hotel industry, aims to pro- vide guests with solutions that cater for all their well- ness needs, such as exercise, food, work and rest. The brand will benefit

from an investment of up to US$150m (EUR111.5m, £94m) over the next three years to support the roll-out, with the first location to be announced in Q2 2012. Bedrooms will be designed for in-room

workouts, with amenities to include a coat rack that doubles as a pull-up bar.

Read Leisure Opportunities online: Te EVEN brand focuses on areas such as exercise, food, work and rest IHG analysed emerging trends and under-

took research over an 18-month period to shape its new holistic wellness travel experience. Details:

Twitter: @leisureopps © CYBERTREK 2012

image: (c) nick robins

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