Strong Q1 occupancy for UK serviced apartment sector

George Sell George Sell Uploaded 04 May 2017

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UK: Latest STR/ASAP research confirms strong Q1 occupancy for the UK serviced apartment sector although the outlook remains mixed.

The sector achieved strong overall occupancy of 75.9 per cent for Q1 2017, a two per cent increase on 2016.

London recorded the highest Q1 occupancy, at 78.3 per cent, a 4.3 per cent increase on 2016 with a strong increase in the average daily rate (ADR) of 7.7 per cent at £170.97.

The picture in the rest of the UK is more mixed, with both Birmingham and Manchester reporting a decrease in Q1 occupancy - Birmingham at 77.2 per cent is down 6.6 per cent on 2016, and Manchester at 76.6 per cent is down 5.8 per cent on last year. However the average daily rate for Birmingham increased by 3.1 per cent to £84.23 and for Manchester by 0.7 per cent to £95.32.

Edinburgh's occupancy was on a par with 2016, at 72.9 per cent but with an increase of 3.2 per cent in the average daily rate to £90.66. Liverpool reported a three per cent increase in occupancy to 71.9 per cent and a slight increase (0.6 per cent) in the average daily rate to £81.99.

Thomas Emanuel, director of business development at STR, said: "As we've seen in the hotel industry, the UK serviced apartment sector is currently benefitting from strong demand as the pound devaluation makes travel to the U.K. more affordable. As a major world hub with a wide variety of accommodation options, it is quite encouraging to see that this uplift in business has extended to serviced apartments, confirming that there is definitely strong consumer interest for this sector."

James Foice, chief executive of the ASAP, said: "It's good to see our sector achieving stronger quarter one occupancy compared to the first quarter in 2016 which was particularly challenging. Anecdotal evidence from a cross-section of our members across the U.K. suggests many operators are cautious about the coming months against the backdrop of the uncertain economic outlook. But it's encouraging to see stronger leisure business particularly in London as the appeal of our serviced apartment product broadens to leisure travellers with the increase in supply, particularly in the aparthotel segment."

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