PwC forecasts slowdown for hotel growth

Growth across the Scottish hotel industry is expected to ease next year after what is shaping up to be a sizzling 2014 for the hospitality sector.

The Ryder Cup will help boost Scotlands hotel sector. Picture: PA

Cultural festivals, the Commonwealth Games and the Ryder Cup are currently driving occupancy to record highs, making a slowdown all but inevitable next year, and PwC’s latest UK hotels forecast is predicting that other factors will come to bear on the market as well.

Martin Cowie, head of private business at PwC in Scotland, said this includes the rise of the so-called “share economy” – for example when travellers rent a private home rather than book a hotel room.

He added: “Sharing economy platforms provide new entrants and individuals the opportunity to present travellers with non-hotel alternatives, and in other locations we’re seeing travellers already taking them up on the offer. Sharing platforms such as Airbnb are growing rapidly, and we expect this trend to continue.”

PwC expects growth in occupancy to moderate “a tad” in 2015, with a 1.6 per cent increase taking occupancy to 76 per cent. Average daily room rates (ADR) are predicted to rise by 4.3 per cent to nearly £65.

During the 12 months to June, ADR rose in Aberdeen, Edinburgh and Glasgow, putting them ahead of the UK regional average of £62. Glasgow saw the strongest rise in revenue per available room, up 15.5 per cent.