Room rates will more than double during London 2012 Olympic Games, according to the annual Hotel Price Index survey by Hotels.com. The average cost of a London hotel room during this period will be GBP 213 a night, a 102 per cent year-on-year increase, the survey found.
David Roche, President, Hotels.com said that he would not be surprised if prices were pushed even higher,
to a trebling of 2011 prices.“Hoteliers like to hold back inventory and drip-feed it in, testing price elasticity. It remains to be seen what fraction of inventory is available,” he said. This can be a gamble - at last year's royal wedding, said Roche, hotels got caught red-handed and ended up with lower occupancy. Supply constraints have added to central London's hotel price inflation. Of London's 100,000 rooms, 40,000 were given to the Olympics organising committee The London Organising Committee for the Olympic Games (LOCOG) at below-market rates -- representing more than 600,000 room nights -- although LOCOG has given 20 per cent of them back, Roche informed. Roche however stressed that room rates are approximately where they were in December 2004. “Hotels on a relative basis are very cheap (despite) strong price growth for a few weeks this summer,” he said. To avoid the worst of central London's price inflation, Roche recommended visitors seek out hotels in satellite towns as many Olympic events take place outside the city. Ufi Ibrahim, Chief Executive, British Hospitality Association, underlined that point, in conversation with BBC, “Don't forget there are a further 75,000 rooms within an easy commute of the Olympic Park. Visitors are also advised to book early.” Roche told in a Reuters report by Peter Myers that there is significant interest in London from BRIC countries (Brazil, Russia, India and China) this summer. The Hotel Price Index, now in its eighth year, is based on a sample of about 142,000 properties in over 85 countries. Global room rates increased by 4 per cent in 2011, with increases in 69 of the 88 city or resort locations analysed. Last year, prices fell two per cent in Asia year-on-year but rose in all other areas: eight per cent in the Pacific, five per cent in North America, four per cent in Latin America, three per cent in the Caribbean and two per cent in Europe and the Middle East, added the report.
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to a trebling of 2011 prices.“Hoteliers like to hold back inventory and drip-feed it in, testing price elasticity. It remains to be seen what fraction of inventory is available,” he said. This can be a gamble - at last year's royal wedding, said Roche, hotels got caught red-handed and ended up with lower occupancy. Supply constraints have added to central London's hotel price inflation. Of London's 100,000 rooms, 40,000 were given to the Olympics organising committee The London Organising Committee for the Olympic Games (LOCOG) at below-market rates -- representing more than 600,000 room nights -- although LOCOG has given 20 per cent of them back, Roche informed. Roche however stressed that room rates are approximately where they were in December 2004. “Hotels on a relative basis are very cheap (despite) strong price growth for a few weeks this summer,” he said. To avoid the worst of central London's price inflation, Roche recommended visitors seek out hotels in satellite towns as many Olympic events take place outside the city. Ufi Ibrahim, Chief Executive, British Hospitality Association, underlined that point, in conversation with BBC, “Don't forget there are a further 75,000 rooms within an easy commute of the Olympic Park. Visitors are also advised to book early.” Roche told in a Reuters report by Peter Myers that there is significant interest in London from BRIC countries (Brazil, Russia, India and China) this summer. The Hotel Price Index, now in its eighth year, is based on a sample of about 142,000 properties in over 85 countries. Global room rates increased by 4 per cent in 2011, with increases in 69 of the 88 city or resort locations analysed. Last year, prices fell two per cent in Asia year-on-year but rose in all other areas: eight per cent in the Pacific, five per cent in North America, four per cent in Latin America, three per cent in the Caribbean and two per cent in Europe and the Middle East, added the report.
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