The cost of renting a room in central London has hit new record highs across the hotel and serviced apartment sectors, according to new research, Sleeping in London, released by Wetherell.
At £2,050 per night, the cost of staying at a 5-star hotel suite in the capital is now eight times more expensive than renting a furnished apartment. Astonishingly, £746,044 is the cost of renting a hotel suite for a year in London; the price equivalent of buying a flat in London or a country house in the home counties.
Mayfair is the destination of London’s most expensive hotel suite, where guests will pay £11,700 per night for the top room.
The report found that there are currently 129,000 hotel rooms in central London, but just 12% are of a 5-star standard. These rooms are typically found in five districts; Mayfair, Knightsbridge, St James, Whitehall/Strand and Kensington.
Average occupancy rates in this luxury sector are a steady 78-80%, clearly indicating a strong demand across the market. On an international comparison, London’s 5-star hotel occupancy rates are now amongst the highest in the world, outstripping Dubai (79%), Paris (78%), Munich (77%), Moscow (70%), Barcelona (69%) and Rome (69%) (HotStats).
A spate of luxury boutique hotels has opened recently in London to meet this growing demand, including 175-bedroom Edition by Marriott and 90-bed Ham Yard.
Others in the pipeline include the 75-bedroom Beaumont Hotel in Mayfair (opening Autumn 2014), the refurbished Lanesborough (scheduled to re-open end 2014), Galliard Group’s 235-bedroom 5 star hotel conversion of the former Scotland Yard headquarters at 3-5 Great Scotland Yard scheduled to open in 2016, and Admiralty Arch, which is planned to become the 100-bedroom Armani London Hotel, opening in 2016.
The findings also revealed that the hotel suite and rented apartment markets are becoming increasingly similar, and branded residences that provide hotels suites, serviced apartments and private sale flats are set to grow and become a major sector of the London hospitality market.
Peter Wetherell, chief executive of Wetherell said: “Our new Wetherell Sleeping in London Report shows the astonishing strength of the recovery in values in the luxury hotel, serviced apartment and private rented markets in PCL since the global recession of 2007 to 2009. Since 2009 hotel and rented apartment rates have risen by over 25% and the cost of renting a room and sleeping in London is now at a record high. In the hospitality sector, Mayfair takes the crown as the most expensive place to sleep in London, and one of the most expensive in the world alongside New York and Monaco.”