Belfast hotels top UK city performance league

Belfast is now amongst the UK’s top-three major cities as measured by the relative performance of the city’s hotels, according to an assessment by PwC.

PwC’s latest review and forecast for the UK hotel sector, As good as it gets – UK hotels forecast 2018, says that the year to date has been largely positive in terms of key metrics. However, the report warns that a mixture of decelerating economic growth, a potential slowdown of inbound tourism and a large increase in new hotel rooms, could slow the sector’s growth in 2018.

Nevertheless, the 2017 performance in the seven months to July 2017 has been particularly positive for Belfast where, when compared with the previous period in 2016, it topped the 22 leading UK cities in the key performance measures of percentage increase in, Occupancy (Occ), Average Daily Rate (ADR) and Revenues per Available Room (RevPAR).

In the seven months to July 2017, Belfast hotels increased their average ADR by 14.1%, significantly ahead of the UK average increase of 4.7%. Belfast was also the top performer in the RevPAR measure, with local hotels boosting average RevPAR by 20.4%, - also well ahead of the UK average growth of 6.1%%.

Turning from average growth to actual financial performance, RevPAR in Belfast in the seven months to July 2017 was fifth highest after London, Edinburgh, Brighton and York, with an average RevPAR of £61.28 per night – just over 20% more than for the same seven-month period to July 2016.

The Average Daily Rate for Belfast hotels, historically amongst the lowest of the UK cities, is moving steadily upwards. In the seven months to July 2016, Belfast’s average ADR had increased to £70.50, ninth amongst the 22 cities reviewed. But in the seven months to July 2017, this had risen to an average of £76.70, the fifth highest of the 22 cities, including London.

Belfast hotels’ 2017 occupancy levels also saw the highest annual increase of 5.5%% in the seven months to July, ahead of Cardiff (4.4%), Liverpool (3.7%) and London (2.6%). This was over three times greater than the average UK hotel occupancy which grew by only 1.4% the seven months to July.

PwC analysed data provided by STR Global relating to 22 cities and Heathrow and Gatwick airport hotels. That amounted to 3,569 UK hotels, accounting for nearly 378,800 rooms. This included 24 large Belfast hotels, covering 3,200 rooms.


Commenting on the latest forecast, PwC Northern Ireland partner Martin Cowie, said:

“The weakness of sterling encouraged record numbers of international leisure tourists to visit London and UK regional cities in 2017. The terror attacks in London and Manchester appear to have had limited impact on visitor levels, meaning hotels have performed strongly so far this year.


“However, the weak pound doesn’t appear to have boosted international business travel to the UK reflecting corporate uncertainty around Brexit, and this has to be something of a worry.


“Next year, hotels are facing a number of challenges which could restrain growth. The level of sterling is attracting leisure tourists, but it is also creating a harsher environment for hoteliers as they have to contend with rising costs and squeezed margins with the weak pound pushing up the cost of imported goods.


“There are also labour issues. The Brexit vote has prompted some workers from EU countries to leave their jobs and we are seeing some hotels struggling to fill these vacancies and facing higher costs when they do so.”


The PwC report - which features Northern Ireland’s Dark Hedges as an example of how film locations can attract global visitors - says UK regional cities that performed particularly well include Cardiff, which hosted this year’s Champions League Final in June; Hull, which saw a 13% lift in occupancy after being awarded the City of Culture status in 2017 and Edinburgh and Belfast, where the cities saw record ADR gains.

Looking to 2018, PwC says that UK regional cities should see average occupancy remaining at around 76% - five percentage points higher than the average of 10 years ago. Average regional ADR should grow by a further 2% in 2018, taking average ADR, in monetary terms to £72, still well below the current Belfast average of £76.70.

However PwC warns that data from AM:PM, point to a further 19,000 rooms planned across the UK in 2018. Of this total, over 7,000 rooms are expected to be in London. Other cities with large pipelines for 2018 include Manchester, Belfast, Glasgow, Edinburgh, Liverpool and Bath. If current levels of growth are not sustained, significant increase in room capacity could mean a decline in the currently healthy ADR, RevPAR and Occupancy levels.

Earlier this year, commercial property firm CBRE identified a number of potential Belfast hotel developments that could more than double the current offering of 3,600 rooms. And while not all 27 potential developments identified may ultimately be built, around 1,100 rooms are likely to come on stream from five development already well advanced. These range from the Marriott AC at City Quays; the 304-room Grand Central in Bedford Street; Hampton in Hope Street; to the 237-room Maldron in Brunswick Street, and the 119-room, Titanic Hotel.


Martin Cowie said that the UK regions should enjoy further growth in 2018, albeit at a slightly slower pace than 2017, due to factors, such as the weak pound and a slack conferences and meetings market.

“Occupancy rates remain a crucial benchmark for profitability for the hotel sector. Regional occupancies have climbed back into the 70 percent territory since 2011 and have been creeping up since then to reach historic highs.


“Belfast continues to be a ‘must-visit’ destination and the steady increase in local performance metrics suggests that this is driving the city further up the performance league.


“However, with almost 80% average occupancy, the city may be vulnerable to hundreds of new rooms coming on stream at roughly the same time and operators may struggle to maintain average occupancy levels and revenues in the shoulder and off-seasons.


“Consequently, it’s important that both the city and region strive to create new attractions and refresh existing successes, while developing products that draw tourists, visitors, conferences and events in the shoulder and off-seasons.”



Notes to editors:

About the report

PwC’s latest review and forecast for the UK hotel sector, As good as it gets – UK hotels forecast 2018, can be downloaded below. The full forecast can be viewed online at:

RevPAR (Revenue per Available Room) is a key industry benchmark. It can be calculated by multiplying the average achieved room rate by the average annual room occupancy rate.

The PwC hotels forecast is based on quarterly econometric analysis of the hotel sector, using an updated PwC macroeconomic forecast released in September and historical statistics supplied by STR Global and other data providers.

Data sources: STR Global; AM:PM Hotel Database (supply), August 2017.


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John Compton
Corporate Affairs, Northern Ireland and Deputy Head of UK Media Relations
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