UK: Meeting Planners Warned to Expect Fewer Freebies
One of the world’s leading hoteliers has warned meeting planners to expect tougher negotiations in 2015 as demand steadily increases.
Mark Sergot, senior VP, global sales organisation of FRHI Hotels and Resorts – which owns the Raffles, Fairmont, and Swissotel brands – says the balance of power is starting to shift towards the supply side of the industry again. As hotels start to report positive figures on increased occupancy and revenue growth, room rates are set to follow, Sergot argued.
He said: “From a performance perspective we are very excited by the results. We have seen RevPAR (revenue per available room) growth of 5-7 per cent, occupancy is at an all-time high but rates are still trailing a bit.
“However we are seeing an increase in demand: there is a bit of compression in the US, Europe is a little softer, and the Middle East is doing well.
“My expectation is that there will be a lot of growth in 2015 across the spectrum. There is a lot of evidence to suggest that there will be significant movement on rates. The pendulum is swinging back to the suppliers’ side as demand increases again. And that will have a knock on effect for lead times, if you are a planner looking at placing an event in eight to 10 months time, you will be hard pressed to find your place of choice.