The Press and Journal (Inverness, Highlands, and Islands)
Aberdeen hotels hit by slump
Study by BDO reveals city had worst occupancy rates in UK last year
Aberdeen hotels had the worst occupancy rates in the UK during 2017, new figures show.
More than one-third of rooms in the Granite City were empty last year, with hotels in Europe’s oil and gas capital only 63.4% filled, according to accountancy and business advisory firm BDO.
Hotels in Inverness did
“We have also seen a lot of new entrants coming into the market”
much better – achieving 76.9% occupancy amid a Scottish tourism boom – but the Highland city was outshone by both Edinburgh and Glasgow, where 85.3% and 83.2% of available rooms were filled respectively.
Aberdeen also suffered the biggest drop in rooms yield in the UK last year, BDO’s Hotel Britain report says.
On this widely-used industry measure of revenue, Granite City hotels earned £41.44 per room last year – down from £47.43 in 2016.
By contrast, rooms yield in Inverness was up by nearly 6% last year, at £43.71, while Edinburgh and Glasgow enjoyed increases of 10.2% to £74.16 and 0.9% to £58.58 respectively.
Andrew Martin, vicechairman of Aberdeen City and Shire Hotels Association, was not surprised to see the Granite City languishing at the foot of BDO’s performance lists after the recent oil and gas industry woes and a raft of new hotel openings in the area.
He added: “These figures reflect a situation where Monday to Thursday business tourism in the city has softened significantly since 2015.
“We have also seen a lot of new entrants coming into the market, adding new supply at the same time as room rates are under pressure.”
But Mr Martin also said business seemed to be picking up, with better occupancy levels producing “green shoots of recovery” since the start of 2018.
Aberdeen is one of six cities in the UK with a negative compound annual growth rate (CAGR) for rooms yield over the past five years, according to BDO.
At -13.8%, the Granite City’s rooms yield CAGR has fallen much further than any of the other five cities in this category.
BDO says hotels in Scotland generally outperformed those in the rest of the UK last year, helped by an influx of overseas visitors and a rise in the number of Britons holidaying closer to home.
Room rates across Scotland averaged £56.20 last year, up by nearly 5% on the 2016 figure, the report says, adding: “The boom in tourism following the depreciation of the pound after the Brexit vote has attracted record-breaking overseas visitor numbers.”