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Glasgow’s hotels show solid performance as city gains a more cosmopolitan image, says HVS report

Glasgow has become one of the UK hotel sector’s unexpected success stories as the Scottish city continues to benefit from a number of initiatives that have boosted its popularity as both a leisure and business destination.
Since the global economic slowdown in 2008 passenger numbers at Glasgow International Airport have increased year-on-year, from both international and domestic passengers. In 2015 numbers returned to pre-crisis levels, while the year-to-August 2016 figures suggest an increase of 7.3% on the same period last year.

Glasgow’s triumph as host of the 2014 Commonwealth Games and the development in 2013 of the SSE Hydro Arena, now one of the world’s top three event venues, have helped boost visitor numbers along with hotel occupancies and RevPAR (rooms revenue per available room).

During the Games average daily rates increased by 17% to £71.62, with RevPAR growing 22.3%. Average rates held firm the following year, while this year’s figures [to October] show a further increase to £74.38, despite occupancy falling slightly.

Increased visitor numbers and a solid performance from hotels has served to boost investor interest. This year saw 350 new rooms added to its supply with a further 1,100 due to come on stream over the next 18 months. While the city’s hotel supply is a balance of budget and full-service offers, those under development are more lifestyle-midscale orientated, appealing to a broader clientele.

“International hotel groups choosing to introduce their latest concepts to Glasgow such as the Radisson Red in 2018 will lift the tone of the city’s hotels. Glasgow is now a much more cosmopolitan city which will help to boost visitor numbers as well as investor interest,” said report author Lionel Schauder, HVS analyst.

“Proposed faster transport links between Glasgow Airport and the city centre and plans to improve connectivity with Edinburgh and the regions will also help the Glasgow’s performance as a tourist destination.”

While UK domestic tourists account for some 75% of visitation and 55% of bed nights, Glasgow’s main international feeder market in 2015 was the US, buoyed in part by the increasing number of visitors coming to learn about their ancestral roots in Scotland.

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