An overview of the UK Hotels market #ATHotelDesign
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Presentation by Philippa Goldstein, Hotel Analyst, Knight Frank at the Architecture Today Hotel Design Seminar on 27 November 2019. More info: http://www.singleply.co.uk/live-blog-architecture-today-hotel-design-seminar-athoteldesign/
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An overview of the UK Hotels market #ATHotelDesign
- 1. An Overview of the UK Hotel MarketUK Hotel Development Trends & Trading Review
- 2. UK Hotel Development Trends & Trading Review Wednesday 27th November 2019 Philippa Goldstein, Hotel Analyst, Knight Frank (Image: Mama Shelter, London)
- 3. Agenda •01 UK Hotel Supply Growth •02 New Hotel Supply Trends •05 Historical Hotel Trading Overview •06 Key Performance Indicators: London v Regional UK •03 The Evolution of Lifestyle Hotels •07 Payroll Costs •04 The Rise of Serviced Apartments •08 Gross Operating Profit
- 5. 9-year CAAG 3.2% 1.7% 2.5% 4.5% 1.3% 4.1% 2.5% 3.7% 4.1% 2.7% 3.3% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 100,000 110,000 120,000 130,000 140,000 150,000 160,000 170,000 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (RoomCount) Total % Change London Hotel Supply 2010-2019
- 6. UK Regional Hotel Supply 2010-2019 9-year CAAG 1.6% 1.2% 1.2% 1.8% 1.2% 1.3% 2.0% 2.1% 1.9% 0.4% 2.0% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 400,000 420,000 440,000 460,000 480,000 500,000 520,000 540,000 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (RoomCount) Total % Change
- 7. 02. New Hotel Supply Trends Image: The Glasshouse, Autograph Collection, Edinburgh
- 8. New Bedroom Supply by Grade 2017- FY 2019 6,900 3,000 2,600 1,100 1,100 500 6,400 2,200 4,600 200 1,400 600 5,300 1,800 4,600 400 1,300 1,100 - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 Budget Branded 3-star 4-Star 5-star Apts 3-star 2019 2018 2017
- 9. % Share of new supply by grade 2016-FY 2019
- 10. UK Hotel Development Activity – by brand (excluding Premier Inn & Travelodge) 0 500 1000 1500 2000 2500 NumberofRoomsOpened 2016 2017 2018 2019
- 11. 03. The Evolution of Lifestyle Hotels Image: Lincoln Plaza, Curio Collection by Hilton, London
- 12. EVOLUTION OF LIFESTYLE HOTELS & BRAND INCEPTION - UKTOTALNUMBEROFLIFESTYLEHOTELROOMS Source: Knight Frank Research derived with data supplied by STR 1994 2008 2006 2007 2012 2011 2010 2016 2015 2013 2017 2019 2018 1999 1985
- 13. 04. The Rise of Serviced Apartments Image: room2 Southampton
- 15. Source: STR, Knight Frank Forecasts SERVICED APARTMENTS BY CITY FY FORECAST 2019 7.0% 1.7%1.8% 6.3% 5.7% 2.1% 3.7% 1.5% 1.2% 1.2% 1.1% 1.0% 1.0% LONDON 12,000 Apartments 48% Market Share 1,730 1,550 1,420 930 520 450 430 360 310 290 270 230 230 - 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 Edinburgh Manchester Liverpool Birmingham Aberdeen Glasgow Leeds Reading Newcastle upon Tyne Bristol Nottingham York Cardiff
- 17. LONDON GOPPAR (£) 2010-2019 “London’s GOPPAR growth keeps pace with inflation” 3-year Fiscal CAAG 3.5% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 60.0 65.0 70.0 75.0 80.0 85.0 90.0 2010 2011 2012 2013 2014 2015 2016 2017 2018 YTD 2018 YTD 2019 %Change GOPPAR(£) GOPPAR GOPPAR % Change RPI % Growth Linear (GOPPAR % Change) Linear (RPI % Growth)
- 18. UK REGIONAL GOPPAR (£) 2010-2019 3-year Fiscal CAAG -0.4% “Challenging market conditions leads to declining profits in 2019” -6.0% -4.0% -2.0% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 20.0 22.0 24.0 26.0 28.0 30.0 32.0 34.0 36.0 38.0 2010 2011 2012 2013 2014 2015 2016 2017 2018 YTD 2018 YTD 2019 %Change GOPPAR GOPPAR GOPPAR % Change RPI % Growth Linear (GOPPAR % Change) Linear (RPI % Growth)
- 19. 06.Key Performance Indicators RevPAR GOPPARTRevPAR s
- 20. CHANGES IN REVPAR CONTRIBUTION BY SEGMENT YTD September 2019 Regional UK London -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% Select Service - Upper Midscale Upper Midscale Upper Upscale Top 15 Towns/Cities Secondary Regional Markets Golf Hotels Spa Hotels Upper Midscale Upper Upscale Luxury
- 21. LONDON £150 % Change £390 % Change £90 % Change TOP 15 CITIES REGIONAL UK £80 £121 £43 SECONDARY REGIONAL UK £53 £80 £23 REVPAR TREVPAR GOPPAR KPIs 12-Month Fiscal Year to September 2019 5.8% -5.6% -0.6% 4.7% -1.0% 3.8% 4.6% -0.2% 3.7%
- 22. 07. Total Payroll Costs Image: Mama Shelter, London
- 23. Total Hotel Payroll Costs 12 Months Oct-Sept, 2018/19 v 2017/18 LONDON UPPER MIDSCALE LONDON UPPER UPSCALE LONDON LUXURY REGIONAL UK TOP 15 REGIONAL UK CITIES SECONDARY REGIONAL UK CITIES % of Total Revenue % of Total Costs 22.4% 29.6%27.8%30.3%29.5%23.6% 36.4% 35.0% “Departmental expenses are increasing at a faster pace than hotel revenues in 2019, due to the strong rise in payroll costs” 8.2% 6.3%6.1% 3.3%5.0% 1.0% % Change PAR 38.6% 34.2% 35% 31.7%
- 24. 08.Gross Operating Profit Image: Kimpton Charlotte Square, Edinburgh
- 25. KPIs – Hotel Profitability, % Change 12 Months Oct-Sept, 2018/19 v 2017/18 5.6% 5.5% (-3.8%) (-3.5%) (0.7%) (-0.9%) (-0.6%) (-1.9%) (-3.7%) (-0.3%) (-5.6%) 5.3% 5.9% A N N U A L % C H A N G E 23 28 31 37 43 50 51 54 74 84 101 154 0 20 40 60 80 100 120 140 160 180 UK Regional - Secondary Towns/Cities UK Regional - Select Service - Upper Midscale UK Regional - Upper Midscale UK Regional - Upper Upscale UK Regional - Top 15 Towns/Cities UK Regional - Conference Hotels UK Regional - Golf Hotels UK Regional - Spa Hotels London - Upper Midscale London - Upper Upscale London - Conference Hotels London - Luxury
- 26. Meet the Knight Frank Hotels Team
- 27. Thank You
- 28. UK Hotel Development Trends & Trading Review
Editor's Notes
- Hello and Welcome. It gives me great pleasure to speak to you this morning at the KF Hotel team’s first breakfast presentation and in my mind there’s no subject more interesting to speak about over breakfast, than a review of the UK hotel market, with specific focus on current trading performance. My aim this morning is to provide you with an overview of the key findings and trends that we have outlined in this year’s edition of The Knight Frank UK Hotel Trading Review. A hard copy of the report will be available to take away with you at the end and so many of the graphs and detailed analysis that I present, you can pour over and dissect in your own time. We have partnered with HotStats, one of the UK’s leading hotel benchmarking providers and we present the very latest year-to-date data, looking at YTD trend to October or on a Rolling 12-month fiscal period.
- Hello and Welcome. It gives me great pleasure to speak to you this morning at the KF Hotel team’s first breakfast presentation and in my mind there’s no subject more interesting to speak about over breakfast, than a review of the UK hotel market, with specific focus on current trading performance. My aim this morning is to provide you with an overview of the key findings and trends that we have outlined in this year’s edition of The Knight Frank UK Hotel Trading Review. A hard copy of the report will be available to take away with you at the end and so many of the graphs and detailed analysis that I present, you can pour over and dissect in your own time. We have partnered with HotStats, one of the UK’s leading hotel benchmarking providers and we present the very latest year-to-date data, looking at YTD trend to October or on a Rolling 12-month fiscal period.