Well it was a packed evening for the Leisure Property Forum's early evening seminar on "How robust is the hotel industry?" A packed audience of about 60 leisure professional gathered at the wonderful offices of Lawrence Graham LLP on the banks of the Thames with it's great views of the Tower of London.
Speaking at the event were Mark Anderson, Commercial & Property Director of Whitbread Hotels & Restaurants and Michael Lacy, Partner at Lawrence Graham LLP. Both great speakers with great knowledge of the sector.
So what did we all find out? It's tough out there!
Within the budget sector, revenue is down some 10% on last year but it has really been bad over the last three months as the sector seems to have fallen into panic mode with some operators offering crazy discounts, especially at weekends.
For the future, Mark predicted that his business, Premier Inns, could be down a further 6% in 2010, holding steady in 2011, rising slightly in 2012 with real and substantial growth not returning until 2015-2016. In simple terms, demand has fallen, room rates have fallen and unless you are running a tight ship, and not to heavily dependent on debt, the next two years could be a struggle.
Will any of the household names fall? Or will it just be the small independents and single site owners that will fail?
Having worked in the design, refurbishment and supply of FF&E to hotels since the 1970's and seen more than one recession now, all I can say is:
"Watch out for some sudden crashes, opportunistic buys and the best in the sector getting stronger as the weak go to the wall."
Andrew Winterbottom, CEO Saturn Projects
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