London’s hotels are facing a dramatic loss in profits with a third of rooms unsold over the summer after tourists have been put off by the Olympics, a survey has found.
An aerial view of the Olympic Park in London showing the Olympic Stadium, the ArcelorMittal Orbit tower, the Aquatics Centre and Water Polo Arena Photo: Anthony Charlton/LOCOG/PA
The boom to the economy that the Government hoped the Games would bring to the capital appears to become a bust with tens of thousands to tourists spurning the hiked prices, congestion and heightened security.
While bookings for July and August are down by 35 per cent on last year other European capitals appear to be prospering from London’s gloom.
French ministers, who lost the Olympic bid to Britain, might be quietly rubbing their hands with glee not only for dodging the £10 billion Games bill but also with a 50 per cent rise in tourism bookings. Similarly Barcelona and Berlin have seen their tourist numbers soar by 100 per cent over the summer.
Part of London’s problems have been caused by the London Organising Committee for the Olympic Games (LOCOG) block booking 40,000 rooms over the period for officials and their families. Hotels then increased prices for remaining rooms only for Locog to return a fifth of the rooms earlier this year.
This has distorted the market place said Terry Williamson, chief operating officer of JacTravel, whose customers include travel agents and hotel websites.
He told BBC Radio Four Today programme that Locog had said the “prices are going to stand up and people are going to come” but this has not happened.
“If you lose a third of your availability and believe that that’s sold for you in the market place then that’s probably going to change your approach to how your price your remaining stock. The fact is that that stock did not sell when you look at our data with seven weeks left to go in market.”
JacTravel found that four-star London hotels were charging up to £415 per night which was nearly four times normal prices.
A survey by Hotel.com found that prices in London have increased by 104 per cent with the average room costing £213 this summer.
Mr Williamson added that “normal tourism” in other Olympic capitals such had Sydney, Beijing and Barcelona had dropped significantly during the Games and “took some time to recover”.