• Home
• News
• Small Luxury Hotels

London cruising at altitude as Farnborough Air Show drives profitability

Due to those magnificent men in their flying machines, profitability in London hotels continued to soar in July with an astounding year on year increase of 30.5%, according to the latest HotStats survey from TRI Hospitality Consulting.

The climb in Gross Operating Profit per Available Room was driven by a staggering 91.9% room occupancy and complemented by a 19.6% increase in achieved average room rate to
£141.91.

As a result of the movement in volume and price, Revenue per Available Room in the capital increased by 23.9% to £130.35.

The location of the biennial Farnborough Air Show is more than one hour’s drive time from central London, but limited availability of hotels in the local area mean people have to look to London.

During the week, the seven-day event acts as a trade show with 1,300 exhibitors, attracting an audience which will include a high proportion of wealthy independent investors, which in 2010 resulted in $47 billion worth of orders being announced. This was followed by a public weekend which attracted 108,000 visitors.

The strength of demand meant that headline performance levels in 2010 surpassed those achieved in the capital the last time the event was held in July 2008, at a room occupancy of 88.4% and an achieved average room rate of £133.20. As a result, RevPAR in 2010 was approximately 11% above 2008. 
“In July, London hoteliers will typically benefit from strong headline performance levels derived from the flocks of tourists, demand from the commercial sector as well as Middle Eastern families escape the searing heat of their home country. The Farnborough Air Show allows hoteliers in the capital to effectively yield the excess capacity”, said Jonathan Langston, managing director, TRI Hospitality Consulting.