MONTH IN REVIEW
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GOVERNMENT LONDON STATISTICS
Real estate company, Colliers
International has said that the
introduction of the voluntary Real
Living Wage will present a “challenge”
to the hospitality sector.
The Real Living Wage rose by 3.6%
to £8.75 per hour regionally and by
4.6% in London, bringing it up to £10.20
per hour.
Katherine Chapman, director of
the Living Wage Foundation, said the
increase was influenced by the level of
inflation which is currently at 3%.
James Shorthouse, head of
alternative markets at Colliers
International, said: “While these salary
increases may on the surface seem like
positive news for staff working across
the UK, for employers who have signed
up to the Living Wage Foundation’s
recommended £8.75 per hour
nationwide and £10.20 in London, the
news presents a further challenge to
hospitality and F&B operators who face
even more pressure on their bottom
line adding to Brexit challenges, rent
and business rates rises, and increased
input costs from imported items.” The British Hospitality Association
(BHA) has hit back at the Greater
London Assembly’s (GLA) plans to
introduce a ‘bed tax’ for the capital’s
hotel rooms.
The London Assembly Economy
Committee met yesterday
(7 November) to further discuss the tax
which it says could add between £91m
to £364m a year to the UK economy.
The plans were first introduced
in January, described as a “Berlin-
style tax of 5% of the room rate per
night”. It could potentially increase
accommodation prices by £3.40.
Ufi Ibrahim, chief executive of the
BHA, said: “The London tourism
tax will unfairly penalise hard-
pressed Britons, who make up the
overwhelming proportion of visitors to
London. Sadiq Khan has proclaimed
“London is Open”, yet is backing a
tax on anyone coming for a weekend
break in the capital, professionals
going about their business and
holidaymakers with their families.
“It’s a tax on fun and business. This
isn’t just about top end hotels, it’s about
hard working people on budget breaks
too. This levy threatens our industry,
which is the lifeblood of the UK’s
economy, employing over half a million
people in London, and generating an
estimated £57bn to the UK’s GDP.”
She added: “Hospitality and
tourism are highly price sensitive, and
domestic and international visitors have
significant destination choice, as do
business tourism, event organisers and
investors. Domestic tourists in the UK
already pay one of the highest rates of
tax in Europe and the World Economic
Forum currently ranks the UK 135 out
of 136 countries in terms of tourism tax
competitiveness.” Some investors could become wary
of hotel assets due to RevPAR (rooms
revenue per available room) plateaus
amid predictions of labour shortages and
increasing costs, according to the Hotel
Bulletin Q3 2017 published this week by
HVS, AlixPartners, STR and AM:PM.
The Bulletin reports that in Q3 2017
average growth in RevPAR at 5% was
the lowest level since Q1 2016, although
the overall long-term outlook for UK
hotels remains positive.
While these results outpace UK GDP
growth, which has averaged below
1% in the same period, the impact of
a lower growth environment, global
political uncertainty and an increasing
threat of terror is taking its toll on
performance across hotels in the 12 UK
cities the Bulletin polls.
Belfast and Edinburgh saw an 11%
RevPAR growth, benefiting from tourists
taking advantage of the weaker pound.
London recorded a 2% increase in
RevPAR, despite a drop in occupancy,
while Aberdeen recorded its eleventh
consecutive quarter fall at the lower
rate of 1%.
Transaction values in Q3 totalled
£1.6bn, boosted by the sale of
Grosvenor House for a reported £550m,
the highest single transaction since
2014. Total transaction values reached
£1bn in Q3, partly down to investors
wanting to complete transactions
before the unknown impact of Brexit.
Real Living Wage
will ‘challenge’
hospitality
industry
UPCOMING
EVENTS
20 & 21 February 2018
Foodservice
Venue Cymru
5 to 8 March 2018
Hotelympia 2018
Excel London
16 to 18 April 2018
Foodex 2018
NEC Birmingham
December 2017
BHA condemns
Sadiq Khan’s
‘unfair’ London
‘tourist tax’
RevPAR
slowdown could
lead to lack of
‘investor interest’
It’s a tax on fun and
business. This isn’t just
about top end hotels, it’s
about hard working
people on budget breaks too
Ufi Ibrahim, chief executive of the BHA
www.hotelowner.co.uk
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