Tourism re­port sounds alert over im­pact of city ho­tel de­vel­op­ments

Bath Chronicle - - BUSINESS - Stephen Sumner Lo­cal democ­racy re­porter @stephen­sum­ner15 | 07741 295876 [email protected]­plc.com

If per­for­mance drops back sig­nif­i­cantly, pro­pos­als for new ho­tels may be de­layed or pos­si­bly can­celled

The im­pact of three new ho­tels open­ing in Bath on ex­ist­ing busi­nesses will be felt un­til 2030, ac­cord­ing to a new re­port. Ho­tel Indigo, No 5 Pier­re­pont Street and the Dom­invs Group de­vel­op­ment in James Street West will col­lec­tively add 372 bed spa­ces to the city’s sup­ply, which has in­creased by nearly 50 per cent since 2009 to 9,921. The mar­ket is also feel­ing the im­pact of the sig­nif­i­cant growth of Airbnb prop­er­ties, which make up 6 per cent of the sup­ply. The re­port has been drawn up by con­sul­tants Ho­tel So­lu­tions for Bath and North East Som­er­set Coun­cil as an up­date on how the in­dus­try has changed since 2015. It found that across Bath and North East Som­er­set there are 1,398 es­tab­lish­ments and 12,227 bed spa­ces, although that fig­ure is only an es­ti­mate be­cause there are so many dif­fer­ent chan­nels that can be used to book them. De­mand for ho­tel rooms in Bath has in­creased by 23.5 per cent since 2015 but the sup­ply is also grow­ing. The 177-bed Apex and the Z Ho­tel with its 149 bed­rooms are the big­gest ar­rivals since then. Ho­tel Indigo and No 5 Pier­re­pont Street are set to open next year. When they are com­pleted, the num­ber of ho­tel bed spa­ces in Bath will be up more than 60 per cent com­pared to 2009, and 37.5 per cent since 2015. Growth has been big­gest in bou­tique ho­tels - since 2009 the num­ber of rooms has seen a ten­fold in­crease to 342. In con­trast, the three-star mar­ket has slumped by 80 per cent and now there are only 70 rooms. The num­ber of bud­get or lim­ited ser­vice rooms has dou­bled to 649. Ex­ist­ing ho­tels will feel the im­pact of the Ho­tel Indigo and No 5 Pier­re­pont Street un­til 2027, the re­port says. The Dom­invs Group’s bou­tique project, on the site of Bath Col­lege’s Allen Build­ing, could ex­tend that be­yond 2030. Hote­liers had urged B&NES Coun­cil to re­lease the re­port be­fore the de­vel­op­ment was ap­proved last month for that very rea­son. Ho­tel So­lu­tions’ pro­jec­tions show that the mar­ket is “un­likely to be able to sup­port this ho­tel for some time without im­pact­ing on ex­ist­ing ho­tels”. It adds: “If per­for­mance drops back sig­nif­i­cantly, pro­pos­als for new ho­tels may be de­layed or pos­si­bly can­celled and ho­tel de­vel­oper in­ter­est is likely to wane.” How­ever, the doc­u­ment es­ti­mates that be­tween 89 and 849 ad­di­tional new rooms may be needed by 2036. The re­port says: “A num­ber of the ho­tel man­agers and own­ers that we spoke to in Bath re­ported that they are fac­ing rapidly in­creas­ing op­er­at­ing costs, par­tic­u­larly in terms of staff wages, busi­ness rates, en­ergy costs and food prices. “With re­duc­ing oc­cu­pan­cies and room rates it is ev­i­dent that ho­tel prof­its are also re­duc­ing in Bath.” It adds: “Ho­tels have to pay higher wages to at­tract and re­tain staff, which af­fects their bot­tom line. The sit­u­a­tion is set to worsen over the next year as fur­ther new ho­tels open.” The re­port says staff re­cruit­ment and re­ten­tion is a “ma­jor is­sues” for Bath ho­tels, made worse by new open­ings and Brexit. Lo­cal peo­ple are not in­ter­ested in work­ing in hos­pi­tal­ity, work­ers can­not af­ford to rent and it is too ex­pen­sive for ho­tels to buy prop­er­ties for them to live in. It is op­ti­mistic, how­ever, about the ho­tel mar­ket over­all, which “re­mains very strong by na­tional per­for­mance met­rics” and says the new open­ings have cre­ated a much more com­pet­i­tive mar­ket. A num­ber of brands are ac­tively pur­su­ing op­por­tu­ni­ties in the city, in­clud­ing Premier Inn, which has told com­mer­cial prop­erty agents that it is seek­ing an­other two sites in the city. In con­trast, Bath’s guest houses and B&BS have been on the de­cline over the last three years, driven by the new ho­tels open­ing, the growth of Airbnb and sim­i­lar plat­forms, and the in­creased year-round avail­abil­ity of city cen­tre stu­dent rooms for short stays. The Uni­ver­sity of Bath ad­ver­tises 326 bed­rooms over the sum­mer, and has an­other 2,200 avail­able for con­fer­ences and sum­mer schools. Bath Spa Uni­ver­sity may start mar­ket­ing the 500 stu­dent bed­rooms at Green Park House at some point in the fu­ture, ac­cord­ing to the re­port. Guest houses and B&BS could re­po­si­tion them­selves to tar­get spe­cific mar­kets like veg­e­tar­i­ans or the LGBT com­mu­nity, it says. In North East Som­er­set there is a “frus­trated de­mand” for camp­ing, and op­por­tu­ni­ties for pub lodges, coun­try house ho­tels and more in­no­va­tive op­tions like tree­houses, glamp­ing, golf lodges and well­ness re­treats. The re­port says the plan­ning sys­tem is a ma­jor con­straint and noth­ing is cur­rently com­ing through. It is not yet clear when B&NES Coun­cil will con­sider the re­port.

Above and left, the Ho­tel Indigo de­vel­op­ment in South Pa­rade. Be­low, cen­tre, how the Dom­invs Group’s ho­tel could look and, right, Bath Col­lege’s Allen Build­ing

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