International commercial property operator Accor has revealed in its first quarter results that increased revenue growth worldwide has been driven in the UK by a very strong period in London, with occupancy rates at near records for the French commercial property company.
The Ibis commercial property operator experienced like-for-like revenue growth of 1.4 per cent in the upscale and midscale parts of the commercial property business, and the economy segment (All Seasons, Ibis and Etap) experienced strong growth of 5 per cent for the first three months of 2012, compared to the same period in the year previously.
High demand across all the commercial property company brands, and what Accor defined as ‘remarkable gains in London’ were the driving force behind the strength in the UK market.
Internationally, the commercial property business, which also operates the Novotel and MGallery brands in the UK, reported like-for-like income growth of 4.5 per cent in the period with ‘solid performance in each segment’. During the quarter, 56 commercial property hotels were opened, accounting for approximately 8,000 rooms; of the new commercial property sites 90 per cent came under management of franchising contracts.
Accor has 185 commercial property hotels in the UK across all its brands with a total of 24,600 rooms.
Economy
Both occupancy and room rates increased in the UK – occupancy levels reached nearly 80 per cent in the upscale and midscale commercial property sites. Yet it was the economy market where the French commercial property operator said it had seen the biggest uplift, as occupancy rates increased to 83.7 per cent.
Accor said: “The ‘dynamic pricing’ policy introduced in the economy hotels in 2011 continued to deliver benefits and is helping to optimize revenue per available room (RevPAR), with strong growth in occupancy rates in the segment.”
In September last year, commercial property group Accor announced it was planning to combine its three economy brands – Etap, Ibis and All Seasons – under one name, to help it better meet ‘changing consumer expectations.’ The Ibis ‘mega-brand’ was essential, according to the commercial property company, in order to address the desire for both budget and upmarket brands to have an up-to-date and contemporary offering.
Expansion
Accor is, at present, in the process of what it refers to as an ‘ambitious and aggressive expansion strategy’, with plans to double its UK commercial property estate by 2015. Management agreements and franchise will make up the majority of the developments. Of the new commercial property hotels opened in the first quarter of the year, 24 per cent were in Europe.
In January, the commercial property operator announced it had opened a record amount of new commercial property hotel rooms across its global commercial property estate in 2011 – a record growth that has continued in this latest results release from the commercial property company.
Furthermore, last week commercial property group Accor launched a comprehensive sustainability programme as part of its bid to cut CO2 emissions by 10 per cent by 2015.
Meanwhile, business consultancy PricewaterhouseCoopers said it estimated the Olympics to make 2012 into a record year for commercial property hotel rate growth, with a projected 2.8 per cent rise in revpar Revenue per available room – a common metric used by the commercial property hotel industry to show performance growth.
Head of hospitality and leisure research at PwC, Liz Hall, said: “Hotels should see a positive impact on occupancy of almost 1.2 points in London and 0.9 points in the regions, taking occupancy to almost 84 per cent in London and 72 per cent outside the capital.”
She added: “If achieved it would be the highest annual occupancy seen in London since the 1970s and the highest ever in the regions.”
