Demand drives international brands to grow Glasgow supply

As global hotel brands look to expand their UK presence, Scotland's largest city is attracting some notable attention. Several deals have been signed for Glasgow hotels in the last month alone by both international and local companies. 

Last month, Carlson Rezidor signed Europe’s first new-build Radisson Red, with the Radisson Red Hotel Glasgow set to open in 2017.  The group already operates a Radisson Blu and a Park Inn by Radisson in the city. The Radisson Red Hotel Glasgow will be operated by The Rezidor Hotel Group and owned by Forrest Hotels, a subsidiary of Glasgow-based Forrest Group.

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In September, the Ramada Glasgow Airport hotel was sold to Newcastle-based Cairn Group for an undisclosed sum. The Cairn Group, which operates 24 hotels—including five in Scotland—said it plans to invest £8 million refurbishing the 114-room hotel over the next 12 months. The group said all 50 staff currently working at the hotel have been retained, with plans to add a further 10 staff going forward.

Most recently, a city center parking lot in Glasgow has been sold by the council for £6.75 million and is destined to become a 395-guestroom hotel. The Ingram Street site, currently leased to National Car Parks Limited, was approved for sale by the council's executive committee. Merchant Hotel Glasgow Limited intends to create a part luxury budget hotel, inspired by the Hoxton in Shoreditch, London, and New York's Soho Grand Centre, a council spokesman said.

By the numbers
Developers have good reason to consider Glasgow for development. According to Business Quarter, the city's hotel sector returned its highest August occupancy on record with 93.4 percent of its rooms sold—an increase of 2 percent on the previous year.

Large-scale conferences at the Scottish Exhibition and Conference Centre, combined with several major events, meant city hoteliers achieved an astonishing 22 nights where occupancy reached 95 percent or higher. 

“Glasgow’s hotel occupancy in August was virtually the same as in Edinburgh, but without the festival, which shows that the city’s tourism demand is year round," Scott Taylor, chief executive of Glasgow City Marketing Bureau, told the site.

The positive revenue performance compared to 2013 in the face of increasing supply highlights the extent of a longer-term growth in the city's hotel sector.

The Daily Record, however, citing accountants and business advisers BDO, reported that overall year-on-year occupancy in Glasgow dropped 3 percent while revenue dropped 22.3 percent, but this could well be due to last year’s Commonwealth Games, held last year from late July to early August.