Traditionally seen as a gateway city, London has been hardest hit by the slump in transatlantic visitors to Europe. Hotels have been hit by the US economic slowdown, compounded by negative foot-and-mouth disease publicity, and corporate caution reflecting uncertainty in Europe.
Occupancy in London's luxury hotels, which has been falling since April, fell by 20.1% during the month of September, and a further 29.8% in October to 60.2%.
According to Arthur de Haast, managing director Europe at Jones Lang LaSalle Hotels, this comes at the worst time for the city's hotels who normally would be enjoying strong corporate and meetings demand. 'September, October and November are amongst the highest yielding months for London's hoteliers, as conference business picks up following the summer lull,' he said. ;'October was the watershed for the industry. Where previously hotels had been able to hold room rates and take the hit in occupancy, October saw room rates start to suffer significantly.'
London's luxury hotels saw only a 2% fall in room rates during the month of September, aided by the ten days of 'normal trading' prior to 11 September. There was no such buffer in October with rates falling by 10.1% to £213.48 ($309.55).
As at August 2001 there were eight hotel developments (1,430 rooms) that were due to open in London before the end of the year. However, since the events of 11 September, all but one of these have been postponed. Delayed projects include the Customs House extension (at ExCel – 156 rooms), Grange Hotel in the City (239 rooms), Crowne Plaza Hotel (203 rooms) at Blackfriars, Threadneedles in the City (70 rooms) and the GWR Hilton at Paddington (355 rooms).
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