Hotel sector gives Edinburgh reasons to be happy

There is room for growth with Edinburgh hotels at 80 per cent capacity. Picture: Neil Hanna

The report, released earlier this month by PwC, shows occupancy of hotels in the capital sitting at a healthy 80 per cent over 2014, up by three points compared to 2012. Meanwhile average daily rates were up to £84, an increase of £7 over the two years, and average revenue per room was up to £68, up from £59 in 2012.

These stats are encouraging, and they matter because they provide an important indicator of how well a city is performing economically, with hotel occupancy levels serving as a barometer of success in both tourism and wider business activity.

What is also promising on those two fronts is that PwC forecasts further growth in all the above metrics over the next two years. There is a real opportunity for Edinburgh to expand its tourism capacity and leverage wider business growth.

Other associated factors – Edinburgh’s status as a World Heritage Site, the continuing expansion of its airport and the city’s high ranking as an international destination in influential web portals such as TripAdvisor, to name just a few – have the potential to support this potential for growth.

Proposed new hotels across Edinburgh, including in New Waverley (aka Caltongate), Calton Hill, Haymarket and the Edinburgh St James development, provide a further vote of confidence for the city.

Flexible summer use of high quality student accommodation is also proving a great solution to demand for beds during peak holiday months. All this will help the city accommodate longer term growth in visitor numbers.

While the prospects are good, Edinburgh’s World Heritage Site status brings both benefits, in proving Edinburgh is a truly unique place to visit, and challenges.

Public and private sector support of a diverse range of future hotel development plans, including those of four- and five-star rating and other tourism offerings will remain essential if Scotland’s capital is to maximise this growth opportunity.

• Roland Smyth is a Senior Associate in the Hotels & Leisure team at law firm CMS