Last year, the proportion of new-build hotels in the UK rose 37 percent, reflecting 2.4 percent growth in the UK’s hotel supply.
In 2018, new-build hotel growth has continued its upward trajectory. Per Knight Frank’s report "UK Hotel Development Opportunities 2018," projected forecasts proclaim the UK hotel market will grow 3.3 percent this year, eclipsing 2017 and equating to more than 21,000 new hotel rooms. In fact, more than 5,200 new hotel rooms opened during the first six months of 2018 and a further 15,000 hotel rooms are in the works.
Commercial property specialists Savoy Stewart analyzed Knight Frank’s Hotel Development Opportunities report to develop a picture of what the future hotel supply will look like in the next three years (2018 to 2021).
The study found that Belfast, Northern Ireland, has experienced the largest increase in new hotel supply and hotels under construction (as a percentage of supply) in 2018 at 34 percent. Meanwhile, Glasgow, Scotland, (18 percent) and Manchester, England, (17 percent) have experienced healthy growth in new hotel supply and hotels under construction in 2018 as well.
Comparatively, Hull, England, has experienced the smallest increase in new hotel supply and hotels under construction (as a percentage of supply) in 2018 at 2 percent. Meanwhile, Newcastle, England, (7 percent) and Leeds, England, (8 percent) have experienced similar, slow levels of growth in new hotel supply and hotels under construction in 2018.
Future Hotel Supply
In terms of rooms in the pipeline/under construction (2018-2021), it may come as no surprise that London will see the highest number of new rooms developing in the future at 14,699. The capital accounts for 40 percent of the development pipeline of hotels under construction in the UK.
London aside, Manchester holds the next highest total of new rooms in the pipeline, with an impressive 2,895 expected, followed closely by Edinburgh, Scotland, with 2,122. These cities have seen substantial regeneration, transformation and reshaping, largely through joint public/private initiatives and institutional investment. Targeted hotel development in key UK cities has been a driving force behind such growth. Manchester is a prime example.
Glasgow (1,431), Birmingham, England, (1,371) and Liverpool, England, (1,161) follow suit, with considerable numbers of new rooms in the pipeline over the next few years.
At the other end of the scale, with far fewer new rooms forecast 2018-2021 are the English cities of Bath (225), Southampton (209) and Gloucester with 128. East Yorkshire’s port city, Hull, lands last in the list with just 35 new rooms in the pipeline.