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Bath Hotel Futures 2015
Hotel Solutions July 2015
CONTENTS
EXECUTIVE SUMMARY ................................................................... i
1. INTRODUCTION ...................................................................... 1 1.1 Background to the Study ........................................................................................... 1 1.2 Study Objective ........................................................................................................... 1 1.3 Uses of the Study ......................................................................................................... 2 1.4 Scope of the Study ..................................................................................................... 2 1.5 Study Methodology .................................................................................................... 3 1.6 Structure of the Report ............................................................................................... 4
2. BATH HOTEL SUPPLY ............................................................... 5 2.1. Current Supply ............................................................................................................. 5 2.2. Changes Since 2009 ................................................................................................... 8 2.3. Planned and Proposed Hotel Development ....................................................... 12 2.4. Comparisons with Other Historic Cities ................................................................. 16
3. CURRENT HOTEL PERFORMANCE & MARKETS ..................... 20 3.1. Occupancy, Achieved Room Rates and Revpar .............................................. 20 3.2 Patterns of Demand ................................................................................................. 22 3.3. Midweek Markets ...................................................................................................... 24 3.4. Weekend Markets ..................................................................................................... 26 3.5. Market Trends ............................................................................................................. 28 3.6 Denied Business ......................................................................................................... 28 3.7. Prospects beyond 2015 ............................................................................................ 29 3.8. Growth in Hotel Demand 2008-2015 ..................................................................... 30
4. STRATEGIC CONTEXT AND DRIVERS OF GROWTH .............. 31 4.1. The Context for Future Growth in the Bath Hotel Market .................................. 31 4.2 The Sub-Regional Strategy for Growth .................................................................. 31 4.3. Economic Performance and Outlook in Bath ..................................................... 33 4.4. National Tourism Trends ............................................................................................ 35 4.5. The Characteristics of Tourism in Bath ................................................................... 37 4.6. Market and Consumer Response Data ................................................................ 39 4.7. Conference Tourism Performance in Bath ........................................................... 40 4.8. Bath Tourism Policies ................................................................................................. 41 4.9. Planning Policies Relevant to Hotel Development ............................................. 44 4.10. Key Projects Affecting Hotel Demand .................................................................. 50 4.11. Conclusions ................................................................................................................ 52
5. FUTURE POTENTIAL FOR HOTEL DEVELOPMENT ................... 53 5.1 Understanding The Requirements and Potential for New Hotel Supply ........ 53 5.2 Hotel Developer & Operator Interest in Bath ....................................................... 61 5.3 Hotel Site Availability ................................................................................................ 74
6. CONCLUSIONS & RECOMMENDATIONS ............................. 76 6.1. The Requirements & Potential for Hotel Development in Bath ........................ 76 6.2. Tackling the Sites Issue .............................................................................................. 79 6.3. The Timing of Hotel Development .......................................................................... 80 6.4. A Locational Strategy for Hotel Development in Bath ...................................... 81 6.5. Implications for the Placemaking Plan ................................................................. 82 6.6. Supporting Existing Hotels, Guest Houses and B&Bs ........................................... 82 6.7. Moving Forwards ....................................................................................................... 83 6.8. Concluding Remarks ................................................................................................ 84
Bath Hotel Futures 2015
Hotel Solutions July 2015
APPENDICES
1 Bath Hotels Interviewed
2 Glossary of Hotel Definitions
3. Heritage City Hotel Stock and Development Comparisons
4. Bath Hotel Developer Testing – Sampling & Response
Lynn Thomason Andrew Keeling
Hotel Solutions Hotel Solutions
Deleanor House Mill Field House
High Street Mill Fields
Coleby Bassingham
Lincoln Lincoln
LN5 0AG LN5 9NP
t. 01522 811255 t. 01522 789702
Bath Hotel Futures 2015
Hotel Solutions July 2015 i
EXECUTIVE SUMMARY
__________________________________________________________________________
The Purpose of the Study
The 2015 Bath Hotel Futures Study has been commissioned by Bath & North East Somerset
Council to provide an up-to-date assessment of the future potential and priorities for hotel
development in Bath through to 2030, to help inform the preparation, finalisation and
implementation of a number of key strategy and policy documents: the update of the
Bath Destination Management Plan, the finalisation of the Placemaking Plan, and the
implementation of the Bath City Riverside Enterprise Area Masterplan. The study updates
the findings of the Bath & North East Somerset Visitor Accommodation Study completed
by The Tourism Company and Hotel Solutions in 2009, in relation to hotel development
opportunities in the city.
Current Hotel Supply
Bath currently has 28 hotels and serviced apartment operations, with a total of 1,591 letting
bedrooms. This includes the Gainsborough Bath Spa which opened on 1 July 2015.
BATH HOTEL SUPPLY – JULY 2015
Standard Hotels Rooms % of
Rooms 5 star 4 306 19.2
Boutique 5 221 13.9
4 star 3 309 19.4
3 star 5 192 12.1
2 star 2 79 5.0
Upper-tier Budget1 1 126 7.9
Budget 3 299 18.8
Serviced Apartments 5 59 3.7
Total Hotels 28 1591 100.0
Notes:
1. Brands including Holiday Inn Express, Ramada Encore and Hampton by Hilton
Bath Hotel Futures 2015
Hotel Solutions July 2015 ii
The city's current hotel offer is weighted towards upscale, full service provision, with 5 star,
boutique and 4 star hotels accounting for 52.5% of total stock. Boutique hotels vary in style
and standard from the MGallery branded Francis Hotel to the luxury AA 3 Red star
Queensberry, midmarket Abbey Hotel and 3 star Metro Harington's Hotel. Budget/limited
service hotels account for 26.7% of Bath's current hotel supply.
Changes in Hotel Supply 2009-2015
Taking account of new hotel openings and changes to existing hotels, Bath's total stock of
hotel accommodation has increased by 18.2% (250 bedrooms) between 2009 and 2015.
The most marked trend has been the significant growth in boutique hotel provision through
the repositioning of 2 and 3 star hotels. There has also been an increase in 4 and 5 star
hotel provision through the upgrading of existing hotels. Other key trends have been an
increase in budget hotel supply, with the opening of a new Premier Inn in December 2013;
a reduction in midmarket full service hotel provision through upgrading to boutique and 4
star hotels; and the gradual increase in serviced apartment supply.
Pipeline Hotel Supply Changes to 2017
There are two hotels currently under construction in Bath - a 177-bedroom 4 star Apex
hotel, with extensive conference facilities for up to 400 delegates, and a 148-bedroom,
budget boutique Z Hotel as part of the Saw Close casino development. The Z Hotel is due
to open in 2016, while the Apex Hotel is scheduled to open early in 2017. The other
significant planned hotel project is the redevelopment of the Pratts Hotel and adjoining
Halcyon Hotel and other properties into a 121-bedroom Hotel Indigo boutique hotel.
Subject to planning permission being granted this hotel could open at the end of 2016. It
will result in a net increase of 54 bedrooms. There are also proposals at various stages for
further boutique hotels in Bath. Assuming that the Apex, Z Hotel and Hotel Indigo all open
by 2017, Bath's hotel stock will have increased by 47% (631 rooms) since 2009, with the
most significant changes being the increase in 5 star, 4 star and especially boutique hotel
provision, and the loss of 3 star stock.
Bath Hotel Futures 2015
Hotel Solutions July 2015 iii
CHANGES IN BATH HOTEL SUPPLY 2009-2017
Standard of Hotel Hotel Supply % Change
2009-2017
(Rooms) 2009 2017
Hotels Rooms Hotels Rooms 5 star 2 181 4 306 +69.1
Boutique 1 29 5 323 +1013.8
4 star 3 223 4 486 +117.9
3 star 10 449 4 146 -67.5
Lower Grade 3 101 2 79 -21.8
Budget/Limited Service 3 317 5 573 +80.7
Serviced Apartments 1 43 5 61 +41.8
Total 25 1343 29 1974 +47.0
Comparisons with Other Heritage Cities
In comparison to Oxford, Cambridge, Chester, York and Exeter:
In terms of total hotel supply Bath has the lowest number of hotel bedrooms;
Bath has the most upmarket hotel supply in terms of 5 star and boutique hotel
provision and 5 star guest houses, and more limited supplies of 3 star, 2 star and
budget hotels.
Hotel development trends have been similar across all six comparator cities
between 2009 and 2015: there has been a general move upmarket, with the
upgrading and repositioning of 3 star hotels as 4 star and boutique hotels, the
opening of new 5 star and boutique hotels in some cities, and some loss of poorer
quality 2 star/ lower grade hotel stock; new Premier Inn and/or Travelodge budget
hotels have opened in most of the cities (other than Oxford); and the supply of
serviced apartments and aparthotels has gradually increased:
All of the comparator cities look set to see more hotel development than Bath
going forward (if all of the current hotel proposals are progressed).
Bath Hotel Futures 2015
Hotel Solutions July 2015 iv
Current Hotel Performance and Markets
Estimated average annual room occupancies, achieved room rates and revpar figures for
Bath hotels for 2012 - 2014 and forecast figures for 2015 are summarised in the table
overleaf, based on the information provided by the city's hotel managers and owners.
Key points to note in relation to hotel performance in Bath and changes since 2012 are as
follows:
Hotel performance in Bath is very strong at all levels in the market, and well ahead
of national averages. Boutique, 3 star and budget hotels are performing particularly
well in the city. 5 star hotels achieve lower room occupancies but very high
average room rates, largely due to the numbers of suites that they have, which
command high prices but do not always fill.
Hotel performance in Bath has generally strengthened between 2012 and 2014 and
looks set to improve further in 2015.
Boutique hotel occupancies and average room rates dipped in 2013 as new
boutique hotels, guest houses and B&Bs have opened. Boutique hotel occupancies
have quickly recovered in 2014 and 2015 as the new boutique hotels have become
more established, and average room rates have started to increase for some
boutique hotels in 2015 .
5 star hotel occupancies have improved but average room rates have dropped
back slightly as hotels have reduced their room rates to drive occupancy.
3 star hotel performance has strengthened year on year.
The opening of the new Premier Inn in December 2013 does not appear to have
had anything other than a marginal impact on the city's established hotels, with
most hotels reporting occupancy and average room rate growth in 2014, and the
Premier Inn quickly achieving high occupancies.
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Hotel Solutions July 2015 v
BATH HOTEL PERFORMANCE 2012-2015
Standard of Hotel Average Annual Room
Occupancy
%
Average Annual Achieved
Room Rate4
£
Average Annual Revpar5
£
2012 2013 2014 2015f3 2012 2013 2014 2015f3 2012 2013 2014 2015f3
UK Provincial Hotels (All Standards)1 69.8 72.6 75 766 59.22 59.94 62.07 64.736 41.32 43.53 46.37 49.146
UK Provincial 3/4 Star Chain Hotels2 69.6 72.0 73.9 n/a 69.97 71.46 76.49 n/a 48.72 51.48 56.53 n/a
5 star 65 n/a 72 74 169 n/a 165 177 110 n/a 119 131
4 star n/a n/a 76 79 n/a n/a 92 100 n/a n/a 70 79
Boutique 86 80 85 86 129 112 116 121 111 89 99 105
3 star 77 81 82 83 73 74 77 78 56 60 63 64
Budget n/a n/a 87 88 n/a n/a 77 83 n/a n/a 67 73
Serviced Apartments n/a n/a 83 84 n/a n/a 107 114 n/a n/a 88 96
All Hotels n/a n/a 81 83 n/a n/a 100 107 n/a n/a 81 88
Source: Hotel Solutions – July 2015
Notes 1. Source: STR Global
2. Source: TRI Hotstats UK Chain Hotels Market Review
3. Based on forecast figures provided by hotel managers
4. The amount of rooms revenue (excluding food and beverage income) that hotels achieve per occupied room net of VAT, breakfast (if included) and
discounts and commission charges.
5. The amount of rooms revenue (excluding food and beverage income) that hotels achieve per available room net of VAT, breakfast (if included) and
discounts and commission charges
6. PwC UK Hotel Forecast 2015
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Hotel Solutions July 2015
Friday and Saturday occupancies are very high for Bath hotels. Hotels of all
standards consistently fill and turn business away on Saturday nights throughout the
year and achieve high occupancies on Friday nights, particularly during the
summer months. Friday occupancies dip a little in winter for most hotels.
Midweek and Sunday occupancies are more seasonal. They are strong in the
summer but weaker during the winter months, especially January, February and
March. 3 star and budget hotels achieve the highest midweek occupancies, both
during the summer and in the winter. They attract stronger year-round demand
from more price conscious corporate customers and overseas tourists, and also
attract business from contractors working on construction and shop fitting projects
in the city. Some boutique hotels are also successfully driving midweek business
through OTAs (online travel agents such as booking.com and Expedia) and a more
flexible room rate strategy.
There is a significant difference between midweek and Friday and Saturday
achieved room rates at all levels in the Bath hotel market. A differential of £30-50 is
typical. Some hotels reported a differential of £80-100. There is also a differential
between summer and winter rates, particularly during the winter , when midweek
and Sunday room rates are much lower and Friday night prices also reduce.
The domestic leisure break and overseas tourist markets are the key markets for
Bath hotels. Weekend break demand is very strong and high-rated, particularly
from the London market. Midweek break business is more price driven, with the
focus primarily on attracting the grey market through OTAs. Overseas tourist
demand is strongest for budget and 3 star hotels, suggesting a significant price
conscious segment in this market. A lot of overseas tourists also book through OTAs.
Corporate demand for hotel accommodation in Bath is relatively weak: there are
few major companies in Bath that generate good volumes of business for the city's
hotels. Corporate demand is stronger for budget hotels, suggesting that this market
is largely price driven in Bath.
Residential conferences are a very minor market for most of Bath's hotels, other
than Bailbrook House, which has extensive conference facilities. Most of the city's
other hotels have very limited conference and meeting facilities so are unable to
target the residential conference market.
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Hotel Solutions July 2015
Growth in Hotel Demand 2008-2015
In terms of total roomnight demand the Bath hotel market has grown by 23% between 2008
and 2015, driven by both an increase in hotel supply and an improvement in occupancy
performance. This equates to an average annual growth rate of 3.3% over the last 7 years.
BATH - GROWTH IN HOTEL DEMAND 2008-2015
Year Total Satisfied
Roomnight
Demand
% Increase in
Roomnights
2008-2015
%
2008 367,646
2015 452,001 + 23%
The Potential for Future Growth in Demand for Hotel Accommodation in Bath
An assessment of the strategic context for economic development and tourism growth in
Bath shows the following in terms of the potential for future growth in demand for hotel
accommodation in the city, and the potential for additional hotel development:
Sub-regional and local economic and tourism policies and spatial and land use
planning frameworks provide a strong basis for economic growth and the
development of Bath's visitor economy, presenting a confident environment for
continued growth in the city's hotel market and further hotel development.
National forecasts for domestic tourism show significant growth in markets for which
Bath has a comparative advantage. The additional boost provided by an even
stronger forecasted growth in overseas tourism will be important in securing new
tourist stays in Bath.
The planned significant growth in Bath's economy, improved transport
infrastructure, and the positive environment provided by the universities, are all
strong drivers for growth in hotel demand in the city. The Riverside Enterprise Area
provides a particular catalyst for growth.
Proposals for new leisure facilities and attractions, and an enhanced events
programme, should lead to future growth in demand for hotel accommodation in
the city from leisure markets.
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Future Requirements & Potential for Hotel Development in Bath
In order to gauge future requirements and potential for hotel development in Bath we have:
Calculated the level of new hotel provision that might be needed to achieve a 5%
p.a. growth in staying tourism in the city through to 2030;
Modelled potential requirements for additional hotel bedrooms under three (Low,
Medium and High) scenarios of potential future growth in midweek demand for
hotel accommodation in the city;
Spoken with national hotel companies to gauge their interest in opening new
hotels in Bath and identify any barriers that they are facing in terms of bringing
forward hotel schemes in the city.
These exercises show potential for significant hotel development in Bath both in terms of
market potential and hotel company interest. The key question is how much of this potential
does the city want to accommodate and at what level in the market? The answers to these
questions will depend on the future strategy for Bath as a visitor destination:
If the city wants to grow staying tourism volumes, it will clearly need more hotel
provision. With hotels trading at such high occupancies for much of the year
growth in staying tourism will need to be largely supply led. There is otherwise little
hotel capacity to support staying tourism growth. The quantum of new hotel
provision needed will depend on the targets for growing Bath's staying visitor
market. The type of new hotel provision required will depend on the markets that
the city wants to attract.
If the city wants to convert more day visitors to staying visitors it will need more
lower-priced hotel accommodation that is affordable for the visitors that currently
stay in hotels in surrounding locations and commute into Bath as day visitors.
If the city wants to attract more companies it will need a greater supply of hotel
accommodation at a price point that companies can afford to pay for single
occupancy room rates.
If Bath is to remain competitive as a staying visitor destination it will need a good
mix of high quality, contemporary hotel accommodation, including a strong
independent hotel offer. Care is needed to avoid undermining the independent
hotel sector, which is a key part of Bath's distinctiveness as a place to stay.
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Our assessments of the requirements and potential for additional hotel provision in Bath show
no immediate requirement before 2020 for additional upscale/full service hotel provision,
beyond the Gainsborough Bath Spa and pipeline Apex and Indigo hotels. The market needs
to absorb this new supply first. There remains very strong interest however from hotel
companies and independent hoteliers that would like to open upscale hotels in Bath. There is
no need to deter this interest, but no need either to actively encourage it. Further upscale
hotel development should be left to the market to determine.
Our growth projections show that Bath should be able to support another budget/limited
service hotel within the next 5 years, in addition to the Z Hotel. Beyond 2020 we are also
showing potential for further budget/limited service hotels through until at least 2030.
There are good reasons for encouraging budget/limited service hotel development in Bath in
terms of the clear demand/potential for more of this type of hotel accommodation in the
city; the new business that budget hotels will generate as a result of their brand strength and
customer base, national marketing, central reservations and referral business from sister
hotels; and the contribution that budget hotels can make to the evening restaurant
economy in the city. There are also some negatives as to why significant budget/limited hotel
development might not be so good for Bath in terms of their potential impact on the city's
remaining 3 star hotels, its guest house and B&B sector and hotels in the surrounding area,
and the potential that they may attract more stag and hen parties. Care is therefore needed
to attract budget/limited service hotel products and brands that will add to the city's hotel
offer, with the focus perhaps being more on attracting upper-tier budget brands e.g.
Hampton by Hilton, and/or some of the new budget boutique brands e.g. Moxy and Aloft.
Our research shows market potential for additional serviced apartment provision in Bath, and
possibly an aparthotel. This type of supply would broaden the city's hotel offer. It would
appeal to the corporate market, especially to longer staying corporate visitors. It is also
becoming increasingly popular with leisure visitors as a result of the greater space, flexibility
and sometimes value for money that it can offer. Serviced apartments have particular
appeal to families and overseas tourists for these reasons. The only potential negative from an
increase in serviced apartments is that they also appeal to the hen party market.
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Tackling the Sites Issue
The availability of suitable and affordable sites for hotel development is the key barrier to
growing Bath's hotel supply. Relatively few sites come up and there is such strong competition
from student accommodation and residential development against which a hotel use
cannot compete on value. How best to address this issue should be a key consideration for
the Council. There are two key roles that it could play if it wants to intervene proactively to
address the hotel sites issue:
As landowner and developer/investor - many of the key regeneration/ development
sites in the city centre are in total or partial Council ownership. The Council thus has
more control over the type of uses that these sites go for, and the type of hotels that
could be included in development schemes (if a hotel use is seen as appropriate
within the mix).
By working with land and property owners to bring forward sites and buildings that
would be suitable for hotel development and match them with key target hotel
products and brands that will help to achieve the strategy for growing staying
tourism in the city (whatever that looks like when finally agreed).
If the Council decides to take either or both of the more interventionist approaches to
addressing the hotel sites issue discussed above, there are two aspects to consider - the
timing of when hotel development needs to come forward, and a locational strategy for
different types and standards of hotel, to optimise the use of available sites and to achieve
the strategy for staying tourism growth.
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Hotel Solutions July 2015
The Timing of Hotel Development
In terms of the timing of new hotel development:
The most immediate requirement is for another budget/limited service hotel or an
aparthotel.
Additional upscale/full service hotel provision will not be required much before
2022/23.
The phased release of sites in the Enterprise Area, some of which could incorporate
a hotel, provides an opportunity to exert some control on when hotel schemes might
come forward; the trick will be to tie this in with the market need in terms of the most
appropriate type of hotel with both market and destination/scheme fit.
A Locational Strategy for Hotel Development
In terms of a locational strategy:
Prime sites in the historic core of the city centre should be prioritised for upscale/full
service hotel development;
Budget/limited service and aparthotel development can be more appropriately
developed on and steered towards edge of city centre and riverside sites;
There could be a case for considering budget hotel development in outer locations
that are well served by bus routes;
Buildings of character should be used for boutique hotels;
Redundant offices may be more suited for conversion to limited service hotels, but
might also present redevelopment rather than conversion opportunities where more
development/a better site solution and scheme could be achieved.
Once the locational strategy has been agreed, it will be important to communicate it to
stakeholders, including site owners and hotel companies; act on it as a Council where direct
intervention is achievable (e.g. where the Council is a full or partial site owner and/or could
act as the developer / investor for a scheme that includes a hotel); and where possible build
it into policy and strategy making, in order to give direction to the market about what the
Council is looking to see delivered in terms of new hotel provision
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Implications for the Placemaking Plan
In finalising the Placemaking Plan:
There is a need to plan for a greater number of additional bedrooms in the city
centre than is identified in the Core Strategy. This Hotel Futures update presents the
market evidence and rationale to do so, with clear links to the previous work and the
context of a much improved climate for investment.
Including the suggested locational strategy for hotel development within the Plan
should be considered as one route to directing and giving clarity to the hotel
development market.
Further work is needed to more closely assess the suitability of key regeneration sites
to the requirements of hotel developers and operators, and to match best fit hotel
products and brands in each case.
It may be appropriate for the Placemaking Plan to also address the issue of the
conversion of redundant office stock to hotel use, recognising the benefits this can
bring to the destination, without enforcing the replacement jobs criteria, which will
be a significant barrier to hotel conversion, particularly at the budget level.
Supporting Existing Hotels, Guest Houses and B&Bs
While further hotel development will be needed to achieve targets and capitalise on the
potential for growth in staying tourism, supporting existing (and new)hotels, guest houses and
B&Bs will also be important through:
Effective management, maintenance and improvement of the city's public realm
fabric;
Further development of the city's visitor offer to maintain and broaden its appeal as
a visitor destination and help encourage longer stays;
Effective marketing of Bath as a visitor destination, focused on boosting Sunday to
Thursday business, particularly during the winter;
Bringing forward office development to grow corporate demand for hotel
accommodation in the city.
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Moving Forwards
In terms of moving ahead, further work will be needed in terms of:
Fleshing out the locational strategy for hotel development in terms of more
detailed assessment of sites and matching best fit hotel products and brands. This
could be expanded to include the identification and assessment of additional sites
with potential for hotel development, both within Council ownership and privately
owned. Both strands would involve working with site owners to communicate and
deliver the hotel investment strategy.
Targeting best fit hotel brands, with a particular focus on those that can most help
deliver the required growth in staying tourism and help grow the Bath hotel market
in terms of generating new demand and attracting new markets. This might
include some additional targets dependent upon the understanding that comes
out of the more detailed sites work.
Feeding into more detailed financial and physical appraisals being led by other
consultancy teams but requiring a specialist input.
Modelling the potential impact of additional budget/ limited service hotel provision
on Bath’s independent guest house sector.
Understanding the options for and potential benefits from direct Council
investment in hotel development schemes, as other local authorities across the
country are increasingly doing.
Concluding Comments
This is a time of great opportunity for B&NES Council to shape the future of Bath in the interests
of its long term viability, sustainability and well-being. The visitor economy undoubtedly has a
key role to play in this, but without increased hotel capacity will be unable to support the city
in fulfilling its potential for staying tourism growth. With such strong hotel performance in the
city; the levels of interest in opening new hotels here; and an emerging development
framework that involves planning for major areas of change, there is a real opportunity to
help overcome the obstacles to delivery faced by hotel developers. This is a unique
opportunity that it is critical to get right, using the evidence from this Hotel Futures Study as a
basis to inform and guide forward planning.
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1. INTRODUCTION
1.1 Background to the Study
1.1.1 The 2015 Bath Hotel Futures Study has been commissioned by Bath & North East
Somerset Council to provide an up-to-date assessment of the future potential and
priorities for hotel development in Bath through to 2030, to help inform the
preparation, finalisation and implementation of a number of key strategy and policy
documents: the update of the Bath Destination Management Plan, the finalisation of
the Placemaking Plan, and the implementation of the Bath City Riverside Enterprise
Area Masterplan. The study updates the findings of the Bath & North East Somerset
Visitor Accommodation Study completed by The Tourism Company and Hotel
Solutions in 2009, in relation to hotel development opportunities in the city.
1.2 Study Objective
1.2.1 The objective of the study was to make a robust, independent, evidence-based
assessment of the potential for the future development of Bath's hotel offer, both in
terms of the opening of new hotels and the expansion, development and
repositioning of existing hotels, based on a thorough examination of the following:
The Bath hotel supply and how this has been changing and is set to change in
the future as pipeline hotel schemes are delivered;
The current performance of the city's hotel sector, at each level in the market;
The prospects for future growth in demand for hotel accommodation in Bath
from the key markets, and what will drive this growth;
Comparisons with hotel provision and development in other leading heritage
city destinations in England;
Hotel company interest in opening new hotels in Bath.
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1.3 Uses of the Study
1.3.1 The study findings will be used to:
Inform the finalisation of the Placemaking Plan;
Input into the update of the Bath Destination Management Plan;
Inform the implementation of the Bath City Riverside Enterprise Area
Masterplan, particularly in terms of guiding Council decisions regarding the
inclusion of hotels within schemes for key regeneration and development sites
that are in full or partial Council ownership;
Guide decision-making on planning applications for new hotel development
projects;
Inform decision-making on planning applications for the expansion of existing
hotels;
Identify other interventions that the Council might consider to influence hotel
development in Bath in line with destination development priorities (once
agreed);
Identify other possible interventions that the Council can make to grow and
develop the city's hotel market to support existing and new hotels.
1.4 Scope of the Study
1.4.1. The geographic focus of the Hotel Futures Study has been on Bath city centre and
outskirts. The study has not covered other parts of Bath & North East Somerset.
1.4.2. In terms of types of hotel the study has looked at the potential for:
Full service 4 and 5 star hotels;
Boutique and lifestyle hotels;
Midmarket/ 3 star hotels;
Budget/limited service hotels;
Serviced apartments/ aparthotels;
1.4.3. Appendix 2 provides a glossary of definitions for these types of hotel.
1.4.4. The study has not looked at the Bath guest house and B&B sector, either in terms of its
future growth potential or the potential impact of new hotel development on guest
house and B&B performance.
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1.5 Study Methodology
1.5.1. The study has involved the following modules of research and consultation:
An audit of the current (July 2015) hotel supply in Bath and how this has
changed since 2009 in terms of new hotel openings and the expansion,
development and repositioning of existing hotels. The audit has been based on
information provided by Bath Tourism Plus, supplemented by our own Internet
searches.
A review of hotel development proposals to identify the likely pipeline changes
to the city's hotel supply in terms of new hotel openings and the development
of existing hotels.
Benchmarking hotel provision and development activity in Bath against
current and pipeline hotel supplies in Oxford, Cambridge, York, Chester and
Exeter, as comparator heritage destinations, to provide a wider context for
considering hotel development requirements for Bath to remain competitive
against these destinations.
A survey of hotel managers and owners in the city to gather data and
information on room occupancy levels and trends, patterns of demand,
achieved room rates, market mix, levels of denials, market trends, and future
development plans. Interviews were conducted primarily through face-to-face
interviews supplemented with telephone interviews as required. We also
obtained hotel performance data from hotel company head offices for some
of the city's hotels, and derived hotel performance figures for one hotel that
declined to take part in our survey from information that we were able to
obtain from our industry contacts. A total of 18 hotels took part in the survey.
They are listed at Appendix 1. We are very grateful to all of the hotel managers
and owners that gave so freely of their time and information to enable us to
produce robust and accurate hotel performance data and market insight
information for the city.
A review of relevant policy and strategy documents and employment and
population forecasts to establish the policy framework for hotel development
in the city and identify likely drivers of future growth in hotel demand.
Bath Hotel Futures 2015
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4
Hotel Solutions July 2015
A review of national tourism trends and forecasts of relevance to Bath.
A review of available research information and data on leisure and
conference tourism in Bath and the city's visitor markets.
Stakeholder consultations to gather information on wider destination
development objectives and major developments with the potential to deliver
new demand for hotels.
The preparation of hotel demand projections (using our Hotel Futures hotel
demand forecasting model) to provide a quantitative estimate of the level of
new hotel development that future market growth might support in Bath
through until 2030.
A survey of national, regional and local hotel companies to test hotel
developer/operator interest in Bath, establish site and location requirements,
and identify any obstacles that hotel companies face relative to investing in
the city.
1.6 Structure of the Report
1.6.1. The report comprises chapters setting out the key findings and conclusions of the
study regarding:
Current hotel supply, recent changes, planned hotel development and
comparisons with other heritage cities;
Current hotel performance and markets:
Future market prospects and drivers of growth in hotel demand;
The future requirements and potential for hotel development in the city.
1.6.2. The final chapter sets out our recommendations for potential Council intervention to
guide and support future hotel development in Bath and grow the city's hotel market
to support existing and new hotels.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 5
2. BATH HOTEL SUPPLY
______________________________________________________________________________________
2.1. Current Supply
2.1.1. There are currently 28 hotels and serviced apartment operations in Bath, with a
total of 1,591 letting bedrooms. This includes the Gainsborough Bath Spa which
opened on 1 July 2015. This current hotel supply is analysed below by standard
and listed fully in the table overleaf.
Table 1
BATH HOTEL SUPPLY – JULY 2015
Standard Hotels Rooms % of
Rooms 5 star 4 306 19.2
Boutique 5 221 13.9
4 star 3 309 19.4
3 star 5 192 12.1
2 star 2 79 5.0
Upper-tier Budget1 1 126 7.9
Budget 3 299 18.8
Serviced Apartments 5 59 3.7
Total Hotels 28 1591 100.0
Notes:
2. Brands including Holiday Inn Express, Ramada Encore and Hampton by Hilton
2.1.2. Bath has a mix of different standards and styles of hotel. The city's current hotel
supply is weighted more towards upscale, full service provision, with 5 star,
boutique and 4 star hotels accounting for 52.5% of total stock. Boutique hotels
vary in style and standard from the MGallery branded Francis Hotel to the luxury
AA 3 Red star Queensberry, midmarket Abbey Hotel and 3 star Metro Harington's
Hotel. Budget/limited service hotels account for 26.7% of Bath's current hotel
supply. Most of the city's serviced apartment operations are small, with 2 or 3
apartments. SACO Bath Serviced Apartments is the only larger serviced
apartment operation.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 6
Table 2
BATH CITY HOTEL SUPPLY – JULY 2015
Hotel Standard1 Rooms Brand The Royal Crescent 5 star 45 Relais & Chateaux
The Bath Priory 5 star 33 Andrew Brownsword Hotels
Macdonald Bath Spa 5 star 129 Macdonald Hotels & Resorts
The Gainsborough Bath Spa 5 star 99 Leading Hotels of the World
Hilton Bath City 4 star 173 Hilton
Bailbrook House Hotel 4 star Country House 94 Hand Picked Hotels
Combe Grove Manor 4 star Country House 42 The Hotel Collection
Francis Hotel Bath Boutique (4 star) 98 MGallery (Accor Hotels)
The Queensberry Boutique (AA 3 Red star) 29
The Abbey Boutique (AA 3 star) 60
The Halcyon Boutique (VB Approved) 21
Haringtons Hotel Boutique (AA 3 star Metro) 13
Lansdown Grove 3 star 54 Coast & Country (Shearings)
The Royal 3 star 35
Pratt's VB Approved (was 3 star) 46 Atlas Hotels
Old Mill Hotel & Lodge, Batheaston 3 star 35
The County Hotel 3 star 22 Seasons Holidays
Redcar Lower Grade 41
Parade Park Lower Grade (VB Approved) 38
Holiday Inn Express Upper Tier Budget 126 Holiday Inn Express (IHG)
Premier Inn Budget 108 Premier Inn
Travelodge Bath Waterside Budget 125 Travelodge
Travelodge Bath Central Budget 66 Travelodge
SACO Bath Serviced Apartments Serviced Apartments 43 SACO
Harington's Apartments Serviced Apartments 3
Halcyon Apartments Serviced Apartments 8
Bath House Apartments Serviced Apartments 2
Bath Circle Serviced Apartments 3
Notes:
1. VisitBritain, AA, booking.com or TripAdvisor ratings. Boutique hotels are those that
describe themselves as such on their websites. There is no official designation of a
boutique hotel.
2.1.3. In addition to hotels, Bath also has 10 large 5 star and boutique guest houses and
B&Bs, with a total of 132 letting bedrooms, which compete to some extent with
the city's hotels.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 7
Table 3
BATH 5 STAR/ BOUTIQUE GUEST HOUSES/ B&Bs – JULY 2015
Establishment Standard Rooms The Ayrlington 5 star 16
Brindleys Boutique 6
Dorian House 5 star Boutique 13
Dukes Boutique 17
Grays Boutique 12
One Three Nine Boutique 10
Paradise House 5 star 11
Tasburgh House 5 star Boutique 12
The Windsor 5 star 15
Villa Magdala 5 star 20
2.1.4. Beyond Bath there are a further 9 hotels in surrounding locations including
Bradford-on-Avon, Colerne, Limpley Stoke, Freshford, Pensford, Trowle Common
and Wick, with a total of 309 letting bedrooms, which compete to some extent
with Bath hotels. They range from luxury 4 and 5 star country house hotels to 3 star
hotels.
Table 4
HOTEL SUPPLY SURROUNDING BATH – JULY 2015
Hotel/Location Standard Rooms Brand
Bradford-on-Avon Woolley Grange Luxury Family Hotel 25 Luxury Family Hotels
Best Western Leigh Park 3 star Country House 45 Best Western
Widbrook Grange 3 star 20
Trowle Common The Moonraker Hotel 3 star Country House 21
Limpley Stoke Best Western Limpley Stoke 3 star Country House 64 Best Western
Colerne Lucknam Park 5 Red star Country House 42 Relais & Chateaux
Pride of Britain Hotels
Freshford Homewood Park 4 star Country House 21 Longleat Hotels
Pensford The Pig near Bath Boutique Country House 29 The Pig
Wick
Tracy Park Golf & Country
Hotel
3 star Golf & Country House
Hotel
42
Bath Hotel Futures 2015
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Hotel Solutions July 2015 8
2.2. Changes Since 2009
New Hotels
2.2.1. Two new hotels have opened in Bath since 2009:
The Premier Inn Bath City Centre opened in December 2013, with 108
bedrooms.
The £16 million, 5 star Gainsborough Bath Spa hotel and spa opened on 1
July 2015, as the UK's first thermal spa hotel. It has 99 bedrooms and suites,
a spa village with thermal pools, saunas, steam rooms, an ice chamber,
treatment rooms and fitness suite; two function/ conference rooms, a
restaurant and bar. It is owned and operated by Malaysian luxury hotel
operator YTL Hotels and will trade at the very top end of the market, with
midweek room rates starting at £285 room only and prices for a Saturday
night starting at £395.
2.2.2. The city's serviced apartment supply has gradually increased in recent years with
the opening of the Halcyon Apartments (in 2014) and the Harington's, Bath House
and Bath Circle apartments.
2.2.3. The city's supply of boutique guest houses and B&Bs has gradually increased since
2009, with the repositioning of the Dukes Hotel as a boutique guest house and
Cheriton House guest house as the Grays boutique B&B, and the opening of
Brindleys boutique B&B.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 9
Hotel Extensions, Refurbishment and Repositioning
2.2.4. Our research has identified the following changes to Bath's hotel supply since
2009 in terms of investment in existing hotels:
The Royal Crescent underwent a complete, £5m refurbishment in 2013
and 2014 under its new owners Topland Group plc, to restore it to one of
the UK's leading luxury hotels.
The Macdonald Bath Spa is currently in the process of refurbishing 109
bedrooms in 2015.
Bailbrook House underwent a £10m refurbishment in 2013 following its
acquisition in 2012 by Hand Picked Hotels to reposition the property as a
4 star hotel. The work included the remodelling of the Mansion House to
create 13 new feature bedrooms.
The Francis Hotel was completely refurbished and repositioned as an
Accor MGallery boutique hotel in 2012 at a cost of £6m.
The Abbey Hotel was acquired by Ian and Christa Taylor in February 2012.
They have gradually upgraded and repositioned it as a midmarket
boutique hotel. The hotel left the Best Western marketing consortium in
September 2014 to operate as an independent hotel.
The 2 star George's Hotel reopened as The Halcyon boutique hotel in 2010,
following a £3m makeover.
The Hilton Bath City has added 23 bedrooms through the conversion of
some of its conference rooms.
Some of the Lansdown Grove Hotel's bedrooms have been upgraded in
the last 2 years.
The Royal has invested £700k in the upgrading of the hotel's bathrooms.
The 3 star Dukes Hotel has been repositioned as the Dukes boutique guest
house.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 10
The upgrading of the Holiday Inn Express to the new generation Holiday
Inn Express bedroom product will commence in August 2015.
The Travelodge Bath Waterside was upgraded to the new Travelodge
bedroom product in 2013, and the Travelodge Bath Central was
upgraded in 2014
2015 Changes in Hotel Ownership
2.2.4. The following hotels have changed ownership in 2015:
Ian and Christa Taylor, owners of the Abbey Hotel, acquired the 20-
bedroom Villa Magdala in June 2015 from its retiring owners. They
reportedly have plans to upgrade the property with new ideas and
concepts.
Rebecca Whittington, one of the sisters behind the Scarlet and Bedruthan
Steps eco-friendly boutique hotels in Cornwall acquired Combe Grove
Manor in July 2015 from The Hotel Collection.
Changes in Bath Hotel Supply 2009-2015
2.2.5. Taking account of new hotel openings and changes to existing hotels, Bath's total
stock of hotel accommodation has increased by 18.2% (250 bedrooms) between
2009 and 2015. There has been a substantial move upmarket in terms of hotel
provision in the city. The most marked trend has been the significant growth in
boutique hotel provision. This has increased sixfold since 2009, albeit from a low
base of just 38 bedrooms, through the repositioning of 2 and 3 star hotels. There
has also been an increase in 4 and 5 star hotel provision. Other key trends have
been an increase in budget/limited service hotel supply, with the opening of the
Premier Inn; a reduction in midmarket full service hotel provision through
upgrading to boutique and 4 star hotels; and the gradual increase in serviced
apartment supply.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 11
Table 5
CHANGES IN BATH HOTEL SUPPLY 2009-2015
Standard of Hotel Hotel Supply % Change
2009-2015
(Rooms) 2009 2015
Hotels Rooms Hotels Rooms 5 star 2 181 4 306 +69.1
Boutique 1 29 5 221 +662.1
4 star 3 223 3 309 +38.6
3 star 10 449 5 192 -57.2
Lower Grade 3 101 2 79 -21.8
Upper-Tier Budget 1 126 1 126 0
Budget 2 191 3 299 +56.5
Serviced Apartments 1 43 5 59 +37.2
Total 23 1343 28 1591 +18.5
Changes to the Hotel Supply in the Surrounding Area
2.2.6. Our research has identified the following changes to the hotel supply surrounding
Bath since 2009:
Luxury Family Hotels acquired Woolley Grange, near Bradford-on-Avon,
from the administrators of Von Essen Hotels in 2011 and has since
refurbished the hotel to a luxury boutique family country house hotel.
Longleat Hotels acquired Homewood Park at Freshford from the
administrators of Von Essen Hotels in 2011 and has since renovated it to a
contemporary country house hotel and spa.
The Old Manor at Trowle Common was acquired by new owners in 2013
and has been renamed as The Moonraker Hotel following refurbishment.
Widbrook Grange at Bradford-on-Avon has new owners.
Home Grown Hotels acquired Hunstrete House at Pensford in 2013 and
reopened it as The Pig near Bath boutique country house hotel in March
2014
The Tracy Park Hotel at Wick was fully refurbished and added 18 bedrooms
in 2013.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 12
2.3. Planned and Proposed Hotel Development
New Hotels Under Construction
2.3.1. There are two hotels currently under construction in Bath - a 177-bedroom 4 star
Apex hotel on James Street West, with extensive conference facilities for up to
400 delegates, and a 148-bedroom, budget boutique Z Hotel as part of the Saw
Close casino development. The Z Hotel is due to open in 2016, while the Apex
Hotel is scheduled to open early in 2017. Further details of the two hotels are
given in the table overleaf.
Proposed New Hotels
2.3.2. The only planning application that has been approved for another new hotel in
Bath is for the conversion of the former King Edward's School on Broad Street to a
12-bedroom boutique hotel and pub. Details are give in the table overleaf.
2.3.3. Bath & North East Somerset Council has also been in pre-application discussions
about a proposal for the conversion of an office building to a 56-bedroom hotel.
2.3.4. A planning application for a 98-bedroom Travelodge next to the Holiday Inn
Express at Brougham Hayes was refused in 2012 and lost at appeal.
2.3.5. A previous permission that was live at the time of the last study, for the conversion
of Green Park House to a hotel, has not happened. It is now to be developed for
student accommodation.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 13
Table 6
BATH – PLANNED/ PROPOSED NEW HOTELS – AS AT JULY 2015
Proposed Hotel Location Standard No
Rooms
Current Status Planned
Opening Year Apex James Street West 4 star 177 Under construction following the demolition of the
Kingsmead House office building on the site. The hotel will
have extensive conference and events facilities for up to
400 delegates, a restaurant and bar, and a leisure pool
and gym. Total investment: £35m
Early 2017
Z Hotel Saw Close Budget
Boutique
148 Under construction. The hotel is being developed as part
of the £14m casino project at Saw Close
2016
Hotel Indigo South Parade Boutique 121 (54 new
rooms)
Atlas Hotels, owners of Pratt's Hotel, has acquired the
adjacent Halcyon Hotel and other linked properties on
South Parade, with a view to converting all of them into a
121-bedroom Hotel Indigo boutique hotel, with
restaurant, bar and gym, that it will operate under a
franchise agreement with InterContinental Hotels Group
(IHG)
2016
Carfax Hotel Great Pulteney
Street
Luxury
Boutique
40 On hold. Plans for the redevelopment and expansion of
the former Carfax temperance hotel into a 40-bedroom
high-end boutique hotel with restaurant and bar have
been dropped following opposition from local residents.
Owners, GECO Properties UK, have indicated that they
intend to draw up new proposals for the redevelopment
of the hotel to take account of the objections. Newbury-
based hotel operator The Vineyard Group is involved in
overseeing the development and management of the
hotel.
n/a
Former King
Edward's School
Broad Street Boutique 12 Planning permission was granted in 2010 and renewed in
2013 for the conversion of the former King Edward's
School into a12-bedroom hotel and pub.
n/a
Francis Hotel Queen Square Boutique 21 Planning permission was granted in 2012 for an extension
to provide an additional 21 bedrooms. It is not known
whether this will proceed.
n/a
Bath Hotel Futures 2015
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Hotel Solutions July 2015 14
Proposed Development of Existing Hotels
2.3.6. Our research has identified the following proposed investment in the expansion,
development and/or upgrading of existing hotels in Bath:
Atlas Hotels is planning to redevelop the Pratts Hotel and adjoining
Halcyon Hotel and other properties into a 121-bedroom Hotel Indigo
boutique hotel to be operated under a franchise agreement with
InterContinental Hotels Group (IHG). Subject to planning permission being
granted the company aims to open the new hotel at the end of 2016.The
scheme will result in a net increase of 54 bedrooms.
Plans to convert the former Carfax Hotel on Great Pulteney Street into a
40-bedroom high-end boutique hotel are currently on hold following
objections from local residents. The owners of the property, GECO
Properties, have indicated that they intend to draw up a revised scheme.
Further information is given in the table overleaf.
The Royal Crescent has plans to develop a new double-storey
conservatory in 2017 that will give the hotel a larger meeting space to
enable it to target the residential meetings market.
The Bath Priory will be refurbished in 2016.
The Macdonald Bath Spa has plans to redevelop its spa facilities.
The Abbey will refurbish all of its bathrooms in 2015, taking it to a 4 star
boutique standard. It is also adding 2 bedrooms in 2015 and considering
plans to develop a new meeting room.
One of Bath's budget hotels is considering a possible extension to add a
further 19 bedrooms.
The Halcyon Apartments is opening an additional two suites in July 2015.
Another of Bath's serviced apartment operations may add 6 apartments.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 15
Changes in Bath Hotel Supply 2009-2017
2.3.6. The trends in terms of growth in upscale and budget/limited service hotel
provision and the loss of midmarket stock are set to continue in 2016 and 2017
with the opening of the Apex and Hotel Indigo at the upper end of the market,
the Z Hotel in terms of budget/ limited service hotel provision, and the loss of the
Pratt's 3 star hotel to the Hotel Indigo conversion. By 2017 the city's hotel stock will
have increased by 47% (631 rooms) since 2009, with the most significant changes
being the increase in 5 star, 4 star and especially boutique hotel provision, and
the loss of 3 star stock.
Table 7
CHANGES IN BATH HOTEL SUPPLY 2009-2017
Standard of Hotel Hotel Supply % Change
2009-2017
(Rooms) 2009 2017
Hotels Rooms Hotels Rooms 5 star 2 181 4 306 +69.1
Boutique 1 29 5 323 +1013.8
4 star 3 223 4 486 +117.9
3 star 10 449 4 146 -67.5
Lower Grade 3 101 2 79 -21.8
Budget/Limited Service 3 317 5 573 +80.7
Serviced Apartments 1 43 5 61 +41.8
Total 25 1343 29 1974 +47.0
Bath Hotel Futures 2015
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Hotel Solutions July 2015 16
2.4. Comparisons with Other Historic Cities
2.4.1. Appendix 3 provides comparisons of current (July 2015) hotel supply, changes in
hotel supply between 2009 and 2015, and planned hotel development in Bath
with Oxford, Cambridge, Chester, York and Exeter. Key observations on these
comparisons are as follows:.
a) Current Hotel Supply
Total Hotel Supply
2.4.2. In terms of total hotel supply Bath has the lowest number of hotel bedrooms of
any of the comparator cities:
York has the most significant hotel supply - almost double the number of
hotel bedrooms that Bath has.
Oxford, Cambridge and Chester have similar numbers of hotel bedrooms -
300-600 more than Bath.
Exeter has a similar number of hotel bedrooms to Bath.
Standard of Hotels
2.4.3. Bath has the most upmarket hotel supply in terms of 5 star and boutique hotel
provision and 5 star guest houses, and more limited supplies of 3 star, 2 star and
budget hotels.
Bath has four 5 star hotels compared to only one in Oxford, York and
Chester and none in Cambridge and Exeter.
Bath has a similar number of boutique hotel bedrooms to Oxford and York
but more than double the boutique hotel supplies of Cambridge, Chester
and Exeter.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 17
Boutique hotels in all six cities are predominantly independent hotels.
Boutique hotel brands represented in the cities are as follows:
o MGallery - Bath
o Malmaison - Oxford
o Hotel du Vin - Cambridge and York
o Hotel Indigo - York
o Abode - Chester and Exeter
o Chapter - Exeter
Bath has the lowest number of 4 star hotel bedrooms. Cambridge, York
and Chester have more than double the number of 4 star hotel bedrooms
that Bath has.
Bath has by far the lowest stock of 3 star and 2 star/lower grade hotel
bedrooms.
Bath has a significant stock of 5 star and boutique guest houses. This type
of accommodation has not so far developed to any extent in the other
cities: Oxford, York and Chester each have only one 5 star guest house,
while Cambridge and Exeter have none.
Exeter and York have two upper-tier budget hotels - a Holiday Inn Express
and a Hampton by Hilton in each case. Bath, Cambridge, Chester and
Oxford each have a Holiday Inn Express.
Bath has the lowest number of budget hotel bedrooms. York and
Cambridge have double the number of budget hotel bedrooms that Bath
has.
Serviced apartments and aparthotels comprise a relatively small element
of the hotel supplies of the six cities. Oxford, Cambridge, York and Chester
have more serviced apartments than Bath. Only Exeter has a smaller
supply of this type of accommodation.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 18
b) Hotel Development 2009-2015
2.4.4. Hotel development trends have been similar across all six comparator cities
between 2009 and 2015: there has been a general move upmarket, with the
upgrading and repositioning of 3 star hotels as 4 star and boutique hotels, the
opening of new 5 star and boutique hotels in some cities, and some loss of poorer
quality 2 star/ lower grade hotel stock; new Premier Inn and/or Travelodge
budget hotels have opened in most of the cities (other than Oxford); and the
supply of serviced apartments and aparthotels has gradually increased:
Bath and York are the only cities that have seen 5 star hotel development.
Bath has seen the most significant increase in boutique hotel provision. This
has been through the repositioning of existing 2 and 3 star hotels. No
entirely new boutique hotels have opened in Bath. All of the other five
cities have seen the opening of new boutique hotels, including a branded
Hotel Indigo in York and an Abode branded boutique hotel in Chester. In
Exeter the former Barcelona boutique hotel has been rebranded under
the Chapter Hotels boutique hotel brand.
None of the six cities have seen the opening of new 4 star hotels in the last
6 years. Two 4 star hotels in Chester have extended.
In terms of upper-tier budget hotel openings, Hampton by Hilton hotels
have opened in York and Exeter. In York the Ramada Encore has been
repositioned as a Travelodge, resulting in only a marginal net change in
the city's upper-tier budget hotel supply.
All of the cities apart from Oxford have seen an increase in budget hotel
provision. Cambridge has seen a significant increase in its budget hotel
supply, with the opening of two Premier Inn and two Travelodge hotels
since 2009. Exeter has seen the opening of two Premier Inns (with a third
due to open in October 2015), while York has seen the opening of a new
Premier Inn and the repositioning of the Ramada Encore to a Travelodge.
Chester has seen the opening of a new Premier Inn but the closure of the
former Comfort Inn. A Travelodge also opened in Chester in 2010 but was
subsequently sold in 2013 for conversion to student accommodation. Bath
has seen the opening of a Premier Inn.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 19
Bath, York and Chester have each seen the closure of a 2 star hotel.
All of the six cities have seen a gradual increase in serviced apartment/
aparthotel provision. Cambridge, York and Chester have seen more
significant rises in their supplies of these types of accommodation. Bath,
Oxford and Exeter have seen only a marginal growth in such provision.
c) Planned Hotel Development
2.4.5. All of the comparator cities look set to see more hotel development than Bath
going forward (if all of the current hotel proposals are progressed):
York and Cambridge are set to see an increase in 5 star hotel provision,
with the planned expansion of The Grand in York and the current
upgrading of the University Arms in Cambridge as a landmark hotel for the
city.
Bath is the only city with a new 4 star hotel currently under construction,
however proposals for new 4 star hotels are also being progressed in
Cambridge and look likely to come forward in Oxford, Exeter and possibly
York.
There are plans for Hotel Indigo boutique hotels in Bath and Oxford and
proposals for new small independent boutique hotels in Bath, Oxford and
Cambridge.
Bath is the only city that is set to see the opening of a budget boutique
hotel, with the Z Hotel being progressed here.
At the 3 star level, a Hilton Garden Inn is planned in York and 3 star hotel
schemes could come forward in Cambridge, Chester and Exeter.
A second Travelodge is currently under construction in Oxford, while a
fourth Premier Inn will open in Exeter in October 2015. There are plans for
Ibis budget hotels in Cambridge and Chester. Bath, York, Chester and
Oxford are all target locations for further Premier Inn hotels, while
Travelodge has Exeter, York and Bath as targets for additional hotels.
A 133-apartment aparthotel has been approved in Cambridge, while
Roomzzz has plans to open an aparthotel in York.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 20
3. CURRENT HOTEL PERFORMANCE & MARKETS
_______________________________________________________________________________________
3.1. Occupancy, Achieved Room Rates1 and Revpar2
3.1.1. Our estimates of average annual room occupancies, achieved room rates and
revpar figures for Bath hotels for 2012 - 2014 and forecast figures for 2015 are
summarised in the table overleaf. These figures are based on the information
provided by the city's hotel managers and owners.
3.1.2. Key points to note in relation to hotel performance in Bath and changes since 2012
are as follows:
Hotel performance in Bath is very strong at all levels in the market, and well
ahead of national averages.
Boutique, 3 star and budget hotels are performing particularly well in the
city. 5 star hotels achieve lower room occupancies but very high average
room rates, largely due to the numbers of suites that they have, which
command high prices but do not always fill.
Hotel performance in Bath has generally strengthened between 2012 and
2014 and looks set to improve further in 2015.
Occupancies and average room rates are rebuilding for some hotels
following reopening after major refurbishment.
Boutique hotel occupancies and average room rates dipped in 2013 as
new boutique hotels, guest houses and B&Bs have opened. Boutique hotel
occupancies have quickly recovered in 2014 and 2015 as the new boutique
hotels have become more established, and average room rates have
started to increase for some boutique hotels in 2015 .
1 The amount of rooms revenue (excluding food and beverage income) that hotels achieve per
occupied room net of VAT, breakfast (if included) and discounts and commission charges. 2 The amount of rooms revenue (excluding food and beverage income) that hotels achieve per
available room net of VAT, breakfast (if included) and discounts and commission charges.
Bath Hotel Futures 2015
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Hotel Solutions July 2015 21
Table 8
BATH HOTEL PERFORMANCE 2012-2015
Standard of Hotel Average Annual Room
Occupancy
%
Average Annual Achieved
Room Rate4
£
Average Annual Revpar5
£
2012 2013 2014 2015f3 2012 2013 2014 2015f3 2012 2013 2014 2015f3
UK Provincial Hotels (All Standards)1 69.8 72.6 75 766 59.22 59.94 62.07 64.736 41.32 43.53 46.37 49.146
UK Provincial 3/4 Star Chain Hotels2 69.6 72.0 73.9 n/a 69.97 71.46 76.49 n/a 48.72 51.48 56.53 n/a
5 star 65 n/a 72 74 169 n/a 165 177 110 n/a 119 131
4 star n/a n/a 76 79 n/a n/a 92 100 n/a n/a 70 79
Boutique 86 80 85 86 129 112 116 121 111 89 99 105
3 star 77 81 82 83 73 74 77 78 56 60 63 64
Budget n/a n/a 87 88 n/a n/a 77 83 n/a n/a 67 73
Serviced Apartments n/a n/a 83 84 n/a n/a 107 114 n/a n/a 88 96
All Hotels n/a n/a 81 83 n/a n/a 100 107 n/a n/a 81 88
Source: Hotel Solutions – July 2015
Notes 1. Source: STR Global
2. Source: TRI Hotstats UK Chain Hotels Market Review
3. Based on forecast figures provided by hotel managers
4. The amount of rooms revenue (excluding food and beverage income) that hotels achieve per occupied room net of VAT, breakfast (if included) and
discounts and commission charges.
5. The amount of rooms revenue (excluding food and beverage income) that hotels achieve per available room net of VAT, breakfast (if included) and
discounts and commission charges
6. PwC UK Hotel Forecast 2015
Bath Hotel Futures 2015
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Hotel Solutions July 2015 22
5 star hotel occupancies have improved but average room rates have dropped
back slightly as hotels have reduced their room rates to drive occupancy.
3 star hotel performance has strengthened year on year.
Some 3 star and boutique hotels have successfully grown their occupancies by
driving more midweek business through more effective use of OTAs1, especially
booking.com, and greater flexibility on room rates.
The opening of the new Premier Inn in December 2013 does not appear to have
had anything other than a marginal impact on the city's established hotels, with
most hotels reporting occupancy and average room rate growth in 2014, and
the Premier Inn quickly achieving high occupancies.
3.2 Patterns of Demand
3.2.1. Our estimates of average annual weekday and weekend occupancies for hotels
in Bath for 2014 are summarised in the table below.
Table 9
BATH HOTELS - WEEKDAY/ WEEKEND OCCUPANCIES – 2014
Standard Typical Room Occupancy
%
Mon-
Thurs
Fri Sat Sun
5 Star Hotels Winter 56 71 91 45
Summer 72 90 95 67
4 Star Hotels Winter 70 82 93 54
Summer 81 90 97 71
Boutique Hotels Winter 73 90 99 67
Summer 88 92 99 81
3 Star Hotels Winter 78 86 89 61
Summer 91 96 99 73
Budget Hotels Winter 81 85 96 56
Summer 91 96 99 81
Source: Hotel Solutions – July 2015
1 Online travel agents, such as booking.com, LateRooms, Expedia, hotels.com,
lastminute.com
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3.2.2. Key points to note are as follows:
Friday and Saturday occupancies are very high for Bath hotels. Hotels of all
standards consistently fill and turn business away on Saturday nights throughout
the year and achieve high occupancies on Friday nights, particularly during the
summer months. Friday occupancies dip a little in winter for most hotels.
Midweek and Sunday occupancies are more seasonal. They are strong in the
summer but weaker during the winter months, especially January, February and
March. 3 star and budget hotels achieve the highest midweek occupancies,
both during the summer and in the winter. They attract stronger year-round
demand from more price conscious corporate customers and overseas tourists,
and also attract business from contractors working on construction and shop
fitting projects in the city. Some boutique hotels are also successfully driving
midweek business through OTAs (online travel agents such as booking.com and
Expedia) and a more flexible room rate strategy.
There is a significant difference between midweek and Friday and Saturday
achieved room rates at all levels in the Bath hotel market. A differential of £30-50
is typical. Some hotels reported a differential of £80-100. There is also a
differential between summer and winter rates, particularly during the winter ,
when midweek and Sunday room rates are much lower and Friday night prices
also reduce.
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3.3. Midweek Markets
3.3.1. Our estimates of the midweek market mix for Bath hotels are set out in the table
below, based on the estimates provided by the city's hotel managers and owners.
Table 10
BATH HOTELS - ESTIMATED MIDWEEK MARKET MIX 2014
Standard
of Hotel
Market
Corporate/
University
%
Contractors
%
Residential
Conference
%
UK Leisure
Breaks
%
Overseas
Tourists
%
Group
Tours
%
5 Star 7 5 72 15 1
4 Star 22 26 26 11 15
Boutique 16 1 55 20 8
3 Star 7 1 1 42 25 24
Budget 33 8 19 39 1
3.3.2. Our key findings regarding midweek demand for hotel accommodation in Bath are
as follows:
Corporate demand for hotel accommodation in Bath is relatively weak,
particularly at the top end of the market. There are few major companies in
Bath that generate good volumes of business for the city's hotels. Corporate
demand is stronger for budget hotels, suggesting that this market is largely
price driven in Bath. Few hotels reported attracting any corporate business
from Bristol companies.
Residential conferences are a very minor market for most of Bath's hotels,
other than Bailbrook House, which as a former residential conference centre
has extensive conference facilities. Most of the city's other hotels have very
limited conference and meeting facilities so are unable to target the
residential conference market. The residential conferences that the city's
hotels attract tend to be relatively small (10-30 delegates) and stay for 1-2
nights. Demand comes primarily from companies in London and the M4
Corridor.
Budget hotels attract midweek demand from contractors working on
construction and shop fitting projects in the city.
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Bath's universities generate some midweek business for the city's hotels from
visiting academics, examiners, conference delegates and parents visiting
their children or dropping them off in September. University graduations and
open days generate significant demand for hotel accommodation.
The Bath Christmas Market is the only other event that noticeably generates
midweek business for the city's hotels.
The domestic leisure break market is the key midweek market for most of
Bath's hotels, particularly its 5 star and boutique hotels. Leisure break
customers typically come from within a 2 hour drive of the city and stay for
2-3 nights in the week. The grey market is the key source of midweek leisure
break business for the city's hotels. Hotels with spas attract good midweek
demand for spa breaks. Most hotels drive midweek leisure break business
through OTAs, but are trying to reduce their reliance on these booking
channels to avoid having to pay the commission charges that they levy.
Midweek leisure break business tends to be more offer-driven in the winter
months.
Overseas tourists are a strong market for Bath's budget and 3 star hotels,
suggesting a significant price-conscious segment in this market. Upscale, full
service hotels also attract some midweek demand from overseas tourists.
Bath hotels attract overseas tourists from a wide range of different countries
including North America, Germany, Spain, France, the Netherlands,
Scandinavia, Australia/NZ, China, Japan, Korea and Russia. Overseas tourists
mostly visit Bath between May and October. The Chinese market visits all
year round, including in January and February, booking primarily through
booking.com. Overseas tourists tend to stay 2 nights in Bath as part of a tour
of the UK, frequently as their second stop after London. Most of Bath's hotels
undertake very little pro-active overseas marketing as they are able to
attract sufficient demand from the UK leisure break market.
Group tours are a key midweek market for the Lansdown Grove, which is
owned by Shearings Holidays, and for one 4 star hotel. This is otherwise a
minor market for some of the city's other hotels. Group tour business tends to
be lower-rated. Hotels do not therefore take it as they are able to fill with
business from higher-rated leisure markets. Group tours are a mix of UK and
overseas tours, particularly from China and Japan, typically staying 2-4
nights in Bath.
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3.4. Weekend Markets
3.4.1. Our estimates of the weekend market mix for Bath hotels are set out in the table
below, based on the estimates provided by the city's hotel managers and owners.
Table 11
BATH HOTELS - ESTIMATED WEEKEND MARKET MIX 2014
Standard
of Hotel
Market
UK Leisure
Breaks
%
Group
Tours
%
Overseas
Tourists
%
Weddings/
Functions
%
Hen
Parties
%
5 Star 85 11 4
4 Star 74 3 7 9 7
Boutique 66 3 22 9
3 Star 76 3 16 5
Budget 41 3 40 5 11
3.4.2. Our key findings regarding weekend demand for hotel accommodation in Bath are
as follows:
Domestic leisure breaks are the key weekend market for Bath hotels.
Weekend break guests typically stay for 1-2 nights. Many hotels apply a
minimum 2 night stay restriction at weekends but are not always able to
achieve this, especially during the winter and shoulder season months.
Weekend leisure break guests tend to be younger than during the week.
They are most typically couples aged 30-50, travelling from within a 2 hour
drive time of the city. London is a key source market for upscale hotels.
Overseas tourists are the other key weekend market for the city's hotels
between May and October. Demand is strongest for budget hotels.
Group tours are a very minor weekend market for Bath hotels as this business
is too low-rated to be of interest to them at weekends. The weekend tours
that hotels take are generally on high room rates.
Weddings and functions are a minor market for the city's hotels, which
concentrate on the weekend break market, which is more likely to deliver
two night stays, whereas wedding guests generally only want a single night
stay.
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Hen parties are a significant secondary weekend market for some hotels, in
particular budget and boutique hotels.
The Bath Christmas Market is the only event that generates significant
weekend demand for Bath's hotels. While other events and festivals are
important as part of Bath's overall visitor offer, few seem to generate hotel
stays in their own right. Events that some hotels identified as noticeably
generating weekend business for them are summarised in the table below.
Table 12
EVENTS THAT GENERATE WEEKEND BUSINESS FOR SOME BATH HOTELS
Event Number of Hotels
Identifying the Event
as a Generator of
Weekend Demand
Bath Half Marathon 4
Bath Rugby matches 3
Jane Austen Festival 3
Great Bath Feast 2
Bath Music Festival 2
Bath to Bristol Marathon 2
Bath Races 2
Bath Mozartfest 1
Race for Life 1
Tour of Britain 1
Race for Life 1
Glastonbury 1
Badminton Horse Trials 1
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3.5. Market Trends
3.5.1. Our discussions with the city's hotel managers and owners identified the following
key trends in the Bath hotel market:
MoD business has reduced as the army bases around Bath have closed.
The residential conference market reduced significantly during the
recession. In line with the national trend it has slowly started to come back
for those hotels that actively target this market.
Many of the city's hotels have successfully boosted their UK leisure break
and overseas tourist business through the use of OTAs.
A number of hotels reported an increase in demand from Chinese tourists
booking mainly through booking.com.
A number of hotels reported a downturn in the US tourist market but a
growth in demand from Australia and New Zealand.
3.6 Denied Business1
3.6.1. The key findings of our research regarding the levels of business that Bath hotels are
currently denying are as follows:
5 star, 4 star, boutique and 3 star hotels only consistently deny business on
Saturday nights. Friday night denials are much less frequent and midweek
denials rare. While hotels can achieve high occupancies on these nights
during the summer they do not generally fill. This appears to be largely
because they hold out to maximise the room rates that they can achieve.
Bath's budget hotels consistently deny significant business both during the
week and at weekends. Budget hotels are the only hotels that consistently
turn midweek business away. Saturday denials are very high and Friday
turndowns are also significant. Midweek denials are frequent and significant
for two of the city's budget hotels but less common and lower for the other
two.
1 Business that hotels have to turn away because they are fully booked
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Some of Bath's hotels reported that they are typically turning away 2-3
enquiries per week for residential conferences that they do not have the
conference facilities to accommodate.
Bath hotels are generally closed out to group tours as this business is too low-
rated for them when they can achieve high occupancies from other
higher-rated leisure markets. Group tours typically stay in Swindon and
possibly Bristol hotels and commute into Bath for the day.
Our research suggests that there is significant lower-rated leisure demand
for hotel stays in Bath that is currently prevented from coming to Bath
because of the high hotel prices in the city. It seems likely that some of this
demand is being picked up by hotels in the surrounding area, whose leisure
guests then commute into the city as day visitors. We know from work that
we undertook in Wiltshire in 2014 that this is certainly the case for hotels in
Bradford-on-Avon, Trowbridge, Melksham, Corsham and Chippenham. We
suspect that people also stay in Bristol to visit Bath. Some of this demand
may also be going to competing destinations such as Oxford, Cheltenham,
Salisbury, Winchester, where there is a greater choice of more affordable
hotel accommodation.
3.7. Prospects beyond 2015
3.7.1. The city's full service 5 star, 4 star and boutique hotels expect to see further
occupancy and rate growth in 2016 but some are concerned about their
prospects once the Apex and Indigo hotels open. The general view is that these
new hotels will dilute the midweek market, probably resulting in lower midweek
occupancies and reduced room rates, depending on the rate strategies that they
adopt.
3.7.2. The city's budget hotels are all confident they can continue to achieve high room
occupancies and steadily increase their average room rates. None of them see
any major threat from the Z Hotel.
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3.7.3. The key markets that Bath hotel managers and owners see as offering growth
potential going forward are:
UK leisure breaks;
Overseas tourists - in particular the Chinese, Russia and US markets;
Residential conferences - for those hotels that have good conference
facilities.
3.7.4. A number of hotel managers and owners identified a need for a much clearer
forward vision for the development of Bath's visitor offer and a clear marketing
strategy for driving midweek staying visits to the city as key prerequisites for
maintaining the viability of the city's existing hotels and supporting new hotel
development.
3.8. Growth in Hotel Demand 2008-2015
3.8.1. The table below summarises how the Bath hotel market has grown since 2008,
through a comparison of the results of the 2009 Visitor Accommodation Study
completed by The Tourism Company and the findings of this Hotel Futures study.
Table13
BATH - GROWTH IN HOTEL DEMAND 2008-2015
Year Total Hotel
Supply
(Rooms)
Av. Annual Room
Occupancy
(All Hotels)
%
Total Satisfied
Roomnight
Demand
% Increase in
Roomnights
2008-2015
%
2008 1343 751 367,646
2015 14922 83 452,001 + 23%
Notes:
1. Source: Bath & North East Somerset Visitor Accommodation Study, The
Tourism Company, December 2009
2. Excluding Gainsborough Bath Spa
3.8.2. In terms of total roomnight demand the Bath hotel market has grown by 23%
between 2008 and 2015, driven by both an increase in hotel supply and an
improvement in occupancy performance. This equates to an average annual
growth rate of 3.3% over the last 7 years.
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4. STRATEGIC CONTEXT AND DRIVERS OF GROWTH
______________________________________________________________________________________
4.1. The Context for Future Growth in the Bath Hotel Market
4.1.1. This section looks at a range of factors that shape the environment and dynamics
for further hotel development in Bath. First it considers the overall economic
context and outlook within Bath and the wider region. It then focuses on tourism,
looking at national and local trends and the tourism strategy for Bath. Finally, it
considers more area specific matters, looking at the planning context for hotel
development and at key projects in and around the city which could be drivers for
growth.
4.2 The Sub-Regional Strategy for Growth
4.2.1. Bath forms part of the West of England. This sub-region links Bath with Bristol and the
surrounding area, forming one of eight core city regions in England which are
assuming an increasingly high profile politically and economically. The
performance of the sub-regional economy and the way this is supported and
promoted has significant implications for Bath.
4.2.2. The West of England has been, and will continue to be, one of the fastest growing
areas in Europe. With a population of just over one million, its economy is worth
some £25.5 billion per year. The sub-region has 7 Enterprise Areas/Zones, with just
one of them in Bath (Riverside).
4.2.3. A Strategic Economic Plan (SEP) 2015-30 has been produced by the West of
England Local Enterprise Partnership. The plan’s targets are for the provision of a
further 65,000 jobs by 2030, and a GVA growth of 2.6% per annum. The plan has
identified five priority sectors: advanced engineering/aerospace; professional
services; creative and digital; high tech; and low carbon. Two of these
(creative/digital and high tech) are particularly identified as opportunities for Bath.
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4.2.4. More specifically, the plan identifies 34 interventions to be supported. A number of
these are generic and should assist growth in Bath, including investment in
broadband, resource efficiency, cultural infrastructure, housing, skills development,
innovation and investment promotion. Three of the site-specific interventions are
located in Bath: West of England Centre of Power and Energy (University of Bath);
Craneworks project (South Quays); and Bath Innovation Project (Innovation
Campus and Quay).
4.2.5. The plan identifies and supports a range of projects for improving transport to and
within the sub-region. The ongoing expansion of Bristol Airport is seen as a strategic
opportunity.
4.2.6. The visitor economy is not targeted per se as a priority sector in the plan. However,
there is strong recognition of its importance as a cross-cutting sector that supports
and benefits from economic growth in other sectors.
4.2.7. The implications of the sub-regional economic position and the SEP for hotel
development in Bath include:
Dynamic growth of the city-region. The SEP portrays a strong sense of
confidence and opportunity. The size, diversity and total growth potential of
the economy of the sub-region is far greater than would be achievable by
Bath on its own. This will further fuel local demand.
Implications for the destination brand. The SEP recognises the world class
cultural heritage of the area as a key strength, with spin off economic
benefits. Equally, the SEP places great emphasis on innovation, creativity
and design as an existing strength of the area which presents a strong
opportunity for growth. The sense of direction is towards a high quality city
region that manages to combine these two assets – i.e. exceptional culture,
style and creativity linking the past through to the present and into the
future. The SEP refers to appealing to “creative workers and affluent visitors”.
This has implications for the future Bristol/Bath brand, with consequences for
future markets and the positioning and style of hotels.
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Opportunities for new investment in leisure and conference facilities and
events. This needs to be considered from a regional perspective. For
instance, the SEP identifies a lack of international level sport and concert
venues in the whole area, which will be partly addressed by the Bristol Arena
project (capacity 12,000).
Linking supply/demand between Bath and Bristol. Significant growth in the
local economy as a whole, together with strengthening transport and other
links between Bristol and Bath, could lead to more opportunities for Bath
hotels to service Bristol generated demand, but also vice versa. Bath could
benefit from more corporate demand generated by Bristol, which contains
five of the West of England’s Enterprise Areas/Zones and many of the site-
specific projects identified in the SEP. However, the SEP also identifies an
ongoing programme of hotel development in Bristol itself.
4.3. Economic Performance and Outlook in Bath
4.3.1. The city of Bath has a population of around 90,000. This compares with a
population of the whole of the B&NES local authority area of 177,600 (2012 figure).
Projections by ONS suggest a population growth for B&NES of 12.1% over the next
25 years. This is significantly lower than the projection for Bristol (22.1%) and for the
sub-region as a whole (20.2%). This differentiation in population growth further
emphasises the importance of the sub-region in generating demand within Bath.
4.3.2. In 2011, the B&NES economy produced an estimated £3.8 billion of GVA output
with total workplace employment of almost 92,000,
4.3.3. Economic performance in B&NES was significantly hit by the global downturn, with
workplace employment in the area falling by 3% between 2007 and 2013. This
compares with a more buoyant performance in the sub-region as a whole, which
saw an increase in workplace employment of around 4% over the same period.
The reason for the greater downturn in Bath is partly explained by the over-
dependency on public sector employment in the city. Since 2012 there has been a
return to growth.
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4.3.4. The Economic Strategy for B&NES (updated 2014) presents a confident outlook. It
sets a target of 16,900 new jobs to be created by 2030, with a projected growth in
GVA per annum of 3.2%. These targets for jobs and GVA suggest a rate of growth
that is relatively higher than for the sub-region as a whole.
4.3.5. The Strategy identifies eight priority sectors. Four of these are identified on account
of their potential to deliver high value growth, with an emphasis on the knowledge
economy, including creative and digital sectors. The other four are identified on
account of their existing importance in the city, while also exhibiting growth
potential. These include retail, professional services, health/wellbeing and
tourism/leisure/ arts/culture. The importance of the visitor economy, in providing
25% of employment and £315m GVA annually, is recognised.
4.3.6. A particular theme of the Economic Strategy is the opportunity to further develop
Bath’s position as an international visitor destination, with an emphasis on achieving
a higher proportion of overnight visitors.
4.3.7. The strategy draws attention to a number of relevant issues and opportunities,
including:
The lack of business space in the city as a barrier to growth, underlining the
need for careful site selection and recognition of competing demands on
land and buildings
Proposals for strengthening connectivity in Bath, including broadband
development and the metro link to Bristol
Developing the arts and cultural themes, including a coordinated plan for
events.
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4.4. National Tourism Trends
4.4.1. In 2013 spending by domestic tourists staying overnight in England was £18.7 billion,
with a similar amount (18.4 billion) spent by inbound visitors.
4.4.2. Tourism spending in England was relatively static between 2006 and 2010 but then
saw reasonable growth to 2013. However, the actual number of trips and nights
has seen little growth over the period as a whole, with a downturn during the
economic crisis followed by recovery. There has been some difference in
performance between domestic tourism (which grew strongly between 2010 and
2012, followed by decline) and inbound tourism (which saw strong growth between
2012 and 2013).
4.4.3. Within the overnight domestic market, over half of all spending (57%) is on holiday
trips, with business tourism accounting for 22% and visits to friends and relatives for
21%. Business tourism was most severely hit by the downturn and has been slower to
recover than holiday tourism.
4.4.4. Looking at different types of destination, large cities and towns as a group have
tended to performed above the national average.
4.4.5. Provisional figures for 2014 point to a significant decline in domestic trips, nights and
spending within England, affecting both holiday and business travel. However,
despite a decline of around 8% in the total number of nights compared with 2013,
nights spent actually in hotels appear to have only declined slightly (from 71.6 to
71.2 million).
4.4.6. By contrast, inbound tourism has continued to see growth in 2014, with nights up by
7%. Greatest growth in inbound tourism has been in London (nights up 10%)
compared with the rest of England (up 5%).
4.4.7. VisitEngland has set a growth target of a 5% increase in tourism spending per
annum between 2010 and 2020. The target had been achieved on average
between 2010 and 2012 but not in 2013 and 2014. Following a recent review of
performance it appears that VisitEngland will maintain this 5% headline target in the
short term. However, this has not been expressed in any predictions for growth in
trips or nights, nor has it been broken down between different types of market.
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4.4.8. Independent forecasts for tourism growth in the medium term are favourable.
Research undertaken by Deloitte and Oxford Economics for VisitBritain in 20131
projects an average annual growth in domestic tourism in the UK of 3% and a 6%
per annum growth in inbound tourism .
4.4.9. A number of factors affecting future tourism trends over the next five to ten years
have been articulated by VisitEngland and others. Those most relevant to hotel
demand in Bath include the following:
Ongoing growth in inbound tourism - with the greatest volumetric growth
occurring in traditional markets including the USA and Western Europe but
the fastest relative growth from China and other emerging markets.
Maintenance of the pull of London as a key draw for overseas tourists -
providing opportunities for destinations in reach of the capital - including
Bath.
o An ageing UK population – the percentage of the UK population over 65 is
increasing. This generation is a powerful and growing economic force, with
sufficient time and disposable income to enjoy short breaks and regular
holidays. It offers particular scope for midweek visiting. The increase in the
number of elderly people in the UK population is also driving growth in the
group tour market.
o Stronger demand for short breaks - society has become increasingly time
poor with shifting patterns of holiday taking to higher frequency short breaks,
with many people now taking multiple short breaks rather than one main
holiday.
o The growing Generation Y market - people born in the 1980s and 1990s are
now starting to travel independently from their parents. This new generation
of hotel guest is looking for a different experience from a hotel stay, with a
greater importance placed on distinctive design, a relaxed atmosphere
and a high level of technology and connectivity.
1 Tourism Jobs and Growth: The Economic Contribution of the Tourism Economy to the UK,
Deloitte/Oxford Economics, November 2013.
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o Online booking and marketing - consumers are increasingly booking hotel
accommodation through the growing number of third party websites that
offer discounted accommodation and holidays such as LateRooms,
lastminute.com, booking.com, Expedia, Trivago, and hotels.com, and taking
advantage of special offers promoted through daily deals sites such as
Groupon, Wowcher, Living Social, Travelzoo and Secret Escapes. Hotels are
also increasingly using e-marketing and social media channels to reach
customers. This is resulting in an increasingly deal-driven and competitive
market but enables hotels to affordably reach millions of potential
customers both in the UK and overseas and allows hotels to proactively
market their available inventory, albeit often at reduced rates. The growth
of customer review sites, in particular Tripadvisor, is making it ever more
important for hotels to deliver excellent standards of service and facilities to
ensure that they achieve favourable reviews and high rankings.
Maintenance of a strong VFR and functions market - providing a stable or
increasing demand for hotel accommodation and associated facilities in
line with population growth.
Further growth in health and wellness tourism - in particular spa breaks.
4.5. The Characteristics of Tourism in Bath
4.5.1. This sub-section contains general information on tourism in Bath. More specific
evidence on hotel performance, occupancy and markets is contained elsewhere
in the report.
4.5.2. Information on tourism flows and spend in Bath is available from annual reports1
prepared for Bath Tourism Plus. These are primarily based on disaggregation of the
national surveys including the Great Britain Tourism Survey and the International
Passenger Survey.
1 The Economic Impact of Bath and North East Somerset’s Visitor Economy 2013,
The South West Research Company Ltd
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4.5.3. The dimensions of domestic and overseas tourism to B&NES are shown in Tables 3.1
and 3.2 below.
Table 14
DOMESTIC TOURISM IN B&NES -2013
All Holiday/
Break
Business VFR Other
Trips (‘000) 684 415 129 126 14
Nights (‘000) 1733 1119 278 309 27
Spend (£m) 124 79.8 31.6 10.7 1.8
Source: SWRC, 20141
Table 15
OVERSEAS TOURISM IN B&NES - 2013
All Holiday/
Break
Business VFR Other Study
Trips (‘000) 283 193 38 44 4 3
Nights (‘000) 1346 722 126 317 53 128
Spend (£m) 94 55.4 15.5 13.8 3.4 5.8
Source: SWRC, 20141
4.5.4. Although the bases for the domestic and international figures are not strictly
comparable, the figures suggest that in 2013 over half (56%) of the tourism nights
and of the spend in Bath was from domestic visitors, with around 44% from overseas
visitors.
4.5.5. Both tables underline the importance of holidays and short breaks as generators of
the majority of nights in Bath. By contrast, business tourism accounts for just
16% of domestic and 9% of overseas nights.
4.5.6. The origin of overseas tourism to Bath has not changed significantly in recent years.
In 2014 the USA was the most significant market (estimated 34k staying visits),
followed by Germany (29k), France (23k), Australia (23k), Spain (21k) and Ireland
(15k). Emerging markets are still a much smaller source – China was estimated at 1k
in 2014 (6k in 2013). The above are very approximate estimates disaggregated from
the International Passenger Survey.
4.5.7. The most important source regions for the domestic overnight market are Greater
London, South East England and South West England.
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4.5.8. Trend data is available on an annual basis for all tourism, although the figures need
to be treated with caution. Domestic nights saw growth up to 2006, followed by a
significant decline to 2009. By 2012 nights had grown back to above to 2006 levels
but there has been some decline since then. Overseas nights have also seen
significant fluctuation during this period, but saw growth in 2013.
4.6. Market and Consumer Response Data
4.6.1. The Bath Visitor Survey 2014 provides some up to date information on visitor profile
and perceptions. Some findings relevant to understanding the market for hotels
include:
83% of overnights spent were in serviced accommodation.
Average length of stay by visitors staying overnight in Bath was 2.47 nights.
Average spend per person staying overnight was £114 per 24 hours, of
which £45 was spent on accommodation and £31 on eating out.
As well as enjoying the attractions of the city itself, a high proportion of
visitors are also touring in the local area and going for walks in the
countryside, suggesting that Bath accommodation should also serve as a
base for such activity and be suitably accessible.
The age profile of visitors is reasonably well spread, although slightly skewed
towards a seniors market (36% of those surveyed were 55 or older).
Satisfaction levels are high, including for accommodation. Quality of
accommodation scores slightly higher than value for money, although
perceptions of the latter have improved over the last ten years.
4.6.2. Further evidence on the performance of Bath as a tourism destination, taken from a
consumer perspective, is available from the VisitEngland Visitor Satisfaction Survey
(TRIM). Data for 2012 shows that, from a set of 29 attributes, Bath is relatively strong
in terms of its heritage buildings, environment, shopping, catering, attractions and
welcome. However, its relatively weaker points include value for money (including
specifically accommodation that offers value for money) transport, events, nightlife
and cost of parking.
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4.7. Conference Tourism Performance in Bath
4.7.1. Evidence on the local conference market is available from a report1 prepared for
Bath Tourism Plus, based on a limited sample of venues. Key results relevant to hotel
demand from this market include the following:
In 2013 there were an estimated 3310 business events at venues
located in Bath, which is slightly down on the 2011 estimate
(3750), but numbers of delegates and spend were up.
Average length of event was 1.9 days, and tended to be
longer in city centre hotels than in venues in the surrounding
area.
The average number of events held per hotel in Bath was 158.
55% of events held in Bath hotels were not overnight, with 36%
involving stays in the hotel itself and 9% involving stays
elsewhere. This is a greater proportion of overnight staying than
was found in 2011.
60% of events in Bath hotels were Corporate, 26% Association
and 14% Public Sector. 46% involved the use of a professional
conference organiser.
Event size in Bath hotels tended to be relatively small, with an
average size of 40 delegates. Only 23% of events involved over
50 delegates and 3% over 100 delegates. Events in non-hotel
venues tended to be bigger.
Average delegate rates for Bath hotels were £169 (24 hour
rate) and £44 (day rate).
1 The Impact of Conference Tourism in Bath, 2013 Team Tourism
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4.8. Bath Tourism Policies
4.8.1. The Destination Management Plan for Bath1 was completed in 2007 and is likely to
be renewed in due course. The plan concluded that tourism in Bath was in good
shape but could do better. Among the weaknesses identified was a lack of
accommodation capacity that inhibits growth. The plan sought to aim high,
promoting Bath as a special place, but with an approach based on refreshing the
offer rather than a dramatic change. The need to strengthen links with the
surrounding area, to add depth to the offer, was recognised. Emphasis was placed
on increasing value, including length of stay, as a priority over increasing volume.
4.8.2. Four themes behind the plan covered: marketing and communication; the tourism
product; infrastructure and environment; and management and leadership.
Specific actions included, amongst many others: making more of events; creating
a new venue for conferences and cultural events; increasing hotel
accommodation in the city; and improving the look and feel of the city centre and
circulation within it. Varied progress has been made in these areas, including in the
field of accommodation and amenity improvement, while it is recognised that
more could be done with regard to venue provision and capitalising on events.
4.8.3. The strategy set quite modest growth targets for 2007-16, for a 10% increase in visits
and a 15% increase in nights in this period. To date it appears2 that the visits target
will broadly be met but the nights target may not – there has been no clear growth
in average length of stay.
1 Bath and North East Somerset Destination Management Plan. The Tourism Company, 2007 2 The results vary significantly according to which year is chosen as the start and end date.
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4.8.4. A Visitor Accommodation Study was completed in December 2009, as an action
arising from the DMP. It was based on extensive consultation with providers and
local businesses. The study concluded that there was scope for adding 256-376
rooms by 2016 and 444-761 rooms by 2026. The development mix proposed was as
follows:
A new 3 or 4 star branded hotel with a preference for a 4 star international
brand if it can help secure or support significantly enhanced conference
facilities.
Attracting two or more boutique hotels.
Some modest expansion of budget chain provision which diversifies the
existing budget offer.
4.8.5. In addition it was proposed that the Council should:
Seek to maintain a viable guest accommodation sector. The impact of new
hotel development on this sector should be monitored and policies
reviewed accordingly.
Encourage some modest expansion of self-catering and hostel
accommodation.
Prioritise the search for ways to create a conference facility to boost
business tourism midweek,
Review car parking policy and provisions for hotels
Consider the potential for the inclusion of visitor accommodation land uses
into employment land use policies.
4.8.6. With Bath's hotel supply set to increase by 630 bedrooms by 2017, the hotel
expansion envisaged by 2026 will largely have been met by this year, other than
under the high growth scenario.
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4.8.7. The Destination Marketing Strategy for B&NES 2012-14 does not directly relate to
hotel development. However, by containing a more up-to-date assessment and
approach to markets it provides important context. The approach is to seek to
increase the proportion of overnights amongst visits to Bath. Amongst overnight
visitor markets, the priority targets are identified as follows:
Couples aged 25-35, ABC1 SINKS/DINKS, London/SE – for city
breaks
Couples aged 45-65, ABC1 Empty Nesters, London/SE – city
breaks plus
Niche segments – cultural experiences; extended families;
female groups.
Visitors to Friends and Relatives – seen mainly as day visitors but
demand for commercial overnights should be recognised (e.g.
from Universities)
North America – ideal fit to Bath offer
Germany – city and culture, but also surrounding countryside
France – owing to market size and spend
China – as an opportunity for the future, capitalising on
heritage and shopping
UK Residential events: Incentive, Corporate, Public and
Associations (esp. London/SE, Midlands)
International incentive travel events – focus on USA and
Germany.
4.8.8. The Strategy sets out a number of marketing priorities and tactical activity covering:
brand communication; marketing framework and delivery partnerships; best
practice and innovation (especially in the digital sphere); delivering a word class
experience; and market intelligence. In general, the approach is more focussed
on promotion than product, although there is an emphasis on generating year
round visits using events and festivals as a stimulus.
4.8.9. The Economic Strategy, 2014 (see sub-section 3.2 above) calls for a revised DMP
and Marketing Strategy. It recognises the importance of investment in the city
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centre facilities and public realm. It also identifies the need for a year round
festivals and events programme. Within the sub-regional context, the Strategic
Economic Plan (SEP) 2015-30 (also see 3.2 above) has a Sector Prospectus with a
short section on tourism. This identifies a number of relevant opportunities, including:
casino licence in Bath; closer collaboration between Bristol and Bath in
international markets; Bath’s positioning as a centre for wellness; the current three-
year Bristol and Bath Cultural Destinations project; and further infrastructure
development to enhance Bath’s position as a World Heritage Site and European
Spa Resort.
4.9. Planning Policies Relevant to Hotel Development
The Core Strategy
4.9.1. The Core Strategy (Part 1 of the Local Plan) was adopted in July 2014. It sets out a
vision for Bath to 2029: “Bath's natural, historic and cultural assets, which combine to
create a unique sense of place of international significance, will be secured and
enhanced to maintain the city's key competitive advantage and unique selling
point as a high quality environment, to live, grow a business, visit and invest”.
4.9.2. The Strategy provides some quantification of planned for economic development:
This includes:
An overall net increase in jobs of 7,000, rising from 60,200 in 2011 to
67,200 in 2029, with significant gains in business services tempered by
losses in defence and manufacturing.
The expansion of knowledge intensive and creative employment sectors
by enabling the stock of office premises to increase from about 173,000
m2 in 2011 to about 213,000m2 in 2029.
Net additional increase to the stock of office premises of 40,000 m2 by
enabling the development of 50,000 m2 of new space, linked to a
managed release of 10,000m2 of that which is qualitatively least suitable
for continued occupation.
Focus new office development within and adjoining the city centre and
enable appropriate levels of business space in mixed use out-of-centre
development sites.
A contraction in the demand of industrial floor space from about
167,000m2 in 2011 to about 127,000m2 in 2029 but sustain a mixed
economy to support Bath's multi-skilled workforce and multi-faceted
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economic base by retaining a presumption of favour of industrial land in
the Newbridge Riverside area.
4.9.3. Within Bath itself, the two main spatial areas of relevance, that are treated
separately, are the Central Area and Western Riverside.
Central Area
Key development opportunities identified include:
City Centre
North of Pulteney Bridge (Cornmarket, Cattlemarket, Hilton Hotel, and The
Podium).
Manvers Street Car Park, Avon & Somerset Police Station and Royal Mail
Depot area.
Green Park Road (Green Park House).
Bath Quays North (Avon Street Car and Coach Park and City College).
Kingsmead (Kingsmead House, Telephone Exchange, Plymouth House and
land in the vicinity of Kingsmead Square).
Neighbouring the City Centre
Bath Quays South (Stothert and Pitt to Travis Perkins).
The Green Park Station area.
The Homebase area including the Pinesway industrial estate and gyratory.
The key activities to be accommodated within the Central Area include:
Small to medium sized comparison retail development where this retains a
compact and continuous primary shopping area.
A net increase of about 40,000 sq m of modern office and creative
workspace, to enable the growth of sectors targeted in the Economic
Strategy.
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2,000 sq m of convenience shopping space to address the overtrading of
existing stores.
Manage the delivery of 500-750 hotel bedrooms to widen the
accommodation offer of the city, increase overnight stays and the
competitiveness of the city as a popular visitor destination.
About 500 additional dwellings as part of mixed use schemes on the key
redevelopment opportunities that have been identified.
A rejuvenated public transport interchange including improvements to Bath
Spa Rail Station.
A comprehensive programme for public realm enhancement and
implementation of a Wayfinding and City Information System.
Existing uses within the Central Area that remain compatible with its future
role and the scope and scale of change envisaged for it, should, where
appropriate, be reincorporated as part of redevelopment proposals, unless
this is not viable or would significantly reduce the capacity of the Central
Area to accommodate jobs or housing development. In such
circumstances reasonable efforts should be made to ensure such uses are
relocated elsewhere.
A cultural / performance / arts venue.
The retention and enhancement of leisure facilities.
Major riverside access and habitat enhancements.
Western Riverside Area
The Western Riverside Area was formerly occupied by the Stothert and Pitt
engineering company and adjoining land has been earmarked for a major
programme of residential led regeneration for a number of years. Western Riverside
is allocated for residential led development in Policy GDS.1/B1 of the Bath and
North East Somerset Local Plan (October, 2007). This policy is supported by a Master
Plan Supplementary Planning Document (March, 2008). This is a complex site but
significant planning progress has been made with the delivery of phase I
commencing in December 2010.
4.9.4. In the thematic area of Tourism, Culture and Sport, the Strategy includes the
following policies:
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Manage the provision of 500-750 new hotel bedrooms to widen the
accommodation offer for the city, increase overnight stays and the
competitiveness of the Bath as a visitor and business destination.
At the Recreation Ground, and subject to the resolution of any unique legal
issues and constraints, enable the development of a sporting, cultural and
leisure stadium.
Enable the provision of enhanced facilities for interpretation of the World
Heritage Site in the Central Area and for the City Archives.
Enable the provision for a new cultural/ performance/arts venue within the
Central Area.
The Placemaking Plan Options Document
4.9.5. The Placemaking Plan (Part 2 of the Local Plan) focuses more on the specifics,
including detailed design principles and development aspirations and updating
the planning policies used in determining planning applications. The Options
Document (November 2014) is in two sections: Development Sites; and
Development Management Policies.
4.9.6. The Plan describes 15 Development Sites in the Central Area and River Corridor.
Three Options are proposed, showing different potential uses across these sites.
Uses are categorised as: Office, Food Retail, Comp Retail, Housing, Hotel, Civic,
and Industrial. Sites with hotels forming part of one or more options include:
Cattlemarket, Manvers Street, Bath Quays North, Kingsmead, Premier Inn,
Gainsborough, and Sawclose. Some of these have already seen hotels
developed or approved. Additional sites have recent planning history with respect
to hotel proposals – e.g. Brougham Hayes. Development and design principles are
set out for each site.
4.9.7. Development site options and treatments are also considered with respect to the
former Ministry of Defence land, the Universities of Bath and Bath Spa, the Royal
United Hospital, and local green space in Bath. Hotel development is not
specifically identified with respect to these sites.
4.9.8. Development Management Policies make some reference to hotel development,
for instance in relation to change of use from residential or office to hotel, which will
only be permitted in certain circumstances (where the office building is of a poor
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quality and has been marketed for sale for 12 months on reasonable terms without
success.
4.9.9. Hotel development in the central area which would entail loss of office space will
need to meet particular conditions if it is to be approved. These include the
ongoing suitability for offices, the achievement of levels of employment equivalent
to that lost from office use, or the provision of other overall benefits for the city that
outweigh the loss.
Enterprise Area Masterplan
4.9.10. Bath City Riverside Enterprise Area Masterplan 2014-2029 identifies opportunities
and provides guidance for development in the river corridor. The EA will be the
focus for new development in Bath during this period, with potential to
accommodate up to 9,000 new jobs and 3,400 homes. It includes 98 hectares of
land along the river corridor in central and western Bath, some 36 hectares of
which is developable brownfield land.
4.9.11. The Masterplan is visionary and conceptual as well as site specific. It proposes a
varied mixed use including industrial sites, workspace (with an emphasis on creative
uses), conservation of natural, historic and industrial heritage, and a variety of
leisure uses. Some reference is made to hotel development.
4.9.1.2 More detailed work relating to the Masterplan has identified specific hotel
opportunities at North Quays, Manvers Street and the Cattlemarket providing,
respectively 222, 175 and 59 jobs.
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BATH CITY RIVERSIDE – ENTERPRISE AREA MASTERPLAN – KEY SITES
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4.10. Key Projects Affecting Hotel Demand
4.10.1. Evidence from current policies and plans, together with other information provided,
suggest that a number of specific projects and initiatives that may be key drivers for
further hotel demand in Bath.
Economic Development and Investment Projects
4.10.2. The main driver will be the staged investment taking place within the Enterprise
Area. A forecast of jobs created and when these will come on stream has been
undertaken as part of the Masterplan exercise. This shows cumulative totals of
around 2,600 jobs being created by 2020, 9,800 by 2025, 11,600 by 2030 and 12,700
by 2035.
4.10.3. The job growth will be phased as various parts of the overall EA come on stream,
starting with the Cattlemarket and South Quays, followed by North Quays and
Green Park West, then Manvers Street, Green Park East and finally South Bank.
University Development and Activity
4.10.4. The two Universities in Bath are significant generators of economic activity and are
likely to play an increasingly important role in the future. They are drivers of a range
of demand for hotel accommodation, for related business activity, conferences,
visiting families and other purposes.
4.10.5. The University of Bath Masterplan 2009-2020 forecasts student growth averaging
between one and three percent per year. More significantly, the plan outlines a
major development programme for the University, with an increase in floorspace of
almost 50% for academic and related activities and an doubling of residential
accommodation on campus.
4.10.6. Bath Spa University has a programme to attract more international students, with a
particular focus on the US in the short term. It also has significant redevelopment
plans for its sites in the period up to 2030, including provision of new academic and
residential space.
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Transport and Infrastructure Improvement
4.10.7. The electrification of the Great Western Main Line, due for completion in 2017, will
further improve accessibility from London. Further development of the Metro
services will facilitate links between Bristol and Bath and other travel within the sub-
region.
Leisure and Cultural Initiatives
4.10.8. A number of specific projects or proposals to strengthen the facilities and project
offer in the leisure and cultural field could have an effect on accommodation
demand in the medium to long term. In each case their status and likelihood of
implementation needs to be confirmed:
Bath Recreation Ground – redevelopment as a new stadium for sport and
leisure events.
Proposals for a new cultural and arts venue in Bath (identified in the Core
Strategy).
Bristol Arena Project, with a capacity of 12,000.
Reference to a forthcoming new attraction in the Bath area which will be
of promotional value.
4.10.9. The programme of events in Bath is expanding. Both the current economic
strategy and the marketing plan emphasise the potential to make more of festivals
and coordinated events as a basis for growing the visitor economy.
4.10.10.A joint project between Bristol and Bath has been funded by Arts Council England
and VisitEngland as part of the Cultural Destinations programme. Due to finish in
2017, this is focussing on ways to gain more value for both cities from a more
integrated approach to arts and culture, with new joint initiatives and structures to
take this forward.
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4.11. Conclusions
4.11.1. The following overall conclusions for future hotel demand can be drawn from this
assessment of strategic context and drivers of growth.
Sub-regional and local economic and tourism policies, and spatial and land
use planning frameworks, provide a strong basis for economic growth and
the development of Bath's visitor economy, presenting a confident
environment for further hotel development.
National forecasts for domestic tourism show significant growth in markets
for which Bath has a comparative advantage. Recent national
performance would point to the need for caution however. The additional
boost provided by an even stronger forecasted growth in overseas tourism
will be important in securing new tourist stays in Bath, including opportunities
to capitalise on growth in incoming tourism to London.
Future hotel investment in Bath should be seen partly in the context of the
West of England sub-region, with its strongly growing, dynamic and diverse
economy, including opportunities for a coordinated tourism offer. This should
create further demand for hotel accommodation in Bath beyond that
which is based purely on the development of the single city.
Within Bath, planned significant growth in the economy and jobs, improved
transport infrastructure and the positive environment provided by the
Universities are all strong drivers for growth. The Riverside EA provides a
particular catalyst, both in terms of supply and demand. Hotel
development should partly reflect the pattern of staged development of
the EA over the next 20 years and beyond.
Proposals for new leisure facilities and attractions and an enhanced events
programme should lead to important additional future demand, but the
level, nature and timing of these initiatives are unclear.
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5. FUTURE POTENTIAL FOR HOTEL DEVELOPMENT
__________________________________________________________________________________________
5.1 Understanding The Requirements and Potential for New
Hotel Supply
5.1.1. With hotel performance in Bath being so strong and the prospects for future growth
in the city's key staying visitor markets looking very positive, it is clear that there will
be scope for additional hotel provision in Bath over the next 15 years. The challenge
is to understand the quantum of new hotel supply that will be needed to meet future
growth requirements and potential, at the same time as maintaining a healthy and
thriving hotel sector that is not undermined by oversupply. There are two ways of
looking at this:
a) An assessment of how Bath's hotel stock will need to develop to achieve
targets for growth in staying tourism.
b) Modelling how demand for hotel accommodation could grow and the
level of new hotel provision that such growth would support, whilst still
allowing existing hotels to trade at current levels.
Hotel Supply Requirements to Meet Growth Targets
5.1.2. While there is no current destination management plan or destination marketing
strategy for Bath, it is reasonable to assume that future plans and strategies will focus
on growing staying tourism volume as a priority, to help support the city's evening
economy and reduce day visitor numbers. With most hotels in Bath trading at, or close
to capacity for much of the year it is clear that future growth in staying tourism in Bath
will need to be largely supply-led. It is useful to consider therefore what a future target
for growth in staying tourism in Bath would mean in terms of requirements for
additional hotel provision to achieve it.
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5.1.3. In the absence of a current target for growth in staying tourism in Bath we have
assumed a target of 5% p.a. in volume through to 2030. This is in line with Visit England's
national target for tourism growth and the target for growth in nights spent in the city
in the 2012-2014 Destination Marketing Strategy for Bath & North East Somerset.
Using this growth rate we have calculated the target future roomnight demand for
hotel accommodation in Bath for each year through until 2030. We have then
worked out how many hotel bedrooms these roomnight figures will support
assuming that all hotels (existing and new) achieve an average annual room
occupancy of 80%. Comparing the results of these calculations to the current
baseline supply of hotel bedrooms in the city gives figures for the numbers of
additional hotel bedrooms that will be needed to achieve the growth target of 5%
p.a.. The results of these calculations are set out in the table below.
Table 16
BATH - REQUIREMENTS FOR ADDITIONAL HOTEL SUPPLY TO ACHIEVE AN ANNUAL
TARGET OF 5% GROWTH IN STAYING TOURISM VOLUME
YEAR NEW HOTEL
ROOMS REQUIRED
PIPELINE NEW
HOTEL ROOMS
2020 436 478
2025 969 478
2030 1649 478
Source: Hotel Solutions
Notes:
1. Gainsborough Bath Spa, Apex, Hotel Indigo (net additional bedrooms),
Z Hotel
5.1.4. These results suggest that the pipeline hotel supply will be sufficient to meet the
requirement for additional hotel provision through until around 2020, after which time
additional new hotel bedrooms will be needed. Clearly if a lower growth target for
staying tourism is selected the requirement for additional hotel development will be
reduced.
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Hotel Demand Projections
5.1.5. The other was of trying to understand future requirements for additional hotel
provision in Bath is to model potential future growth in demand for hotel
accommodation in the city and then work out how many additional hotel
bedrooms such growth might support in the city without undermining the
performance of existing hotels. We have developed our Hotel Futures demand
forecasting model to do this. The model combines baseline data on hotel supply,
occupancy and denials with assumptions on potential future growth in hotel
demand based on other available forecasts and indicators of future market growth
and reflecting the need to ensure a viable future for existing hotels and avoid
excessive price competition as a result of oversupply. Any demand modelling
approach is a hypothetical one, based on assumptions. The results should therefore
be treated as indicative only and should be periodically reviewed and updated.
5.1.6. In order to provide an indication of the number of new hotel bedrooms that
might be needed in Bath through to 2030 as the city's hotel market grows, we
have prepared projections of possible future growth in hotel demand in Bath to
2020, 2025, and 2030, using our Hotel Futures demand forecasting model. Projections
have been prepared for upscale/ full service (5 star, 4 star and boutique hotels) and
budget/limited service hotels taking the current (July 2015)supply of hotels10 in the city
and forecast 2015 roomnight demand as the baselines for the projections.
There is an insufficient and reducing supply of 3 star hotels to enable us to run
projections at this level.
5.1.7. Given the strength of demand for hotel accommodation in Bath it is not unreasonable
to assume that all hotels, both existing and new, will continue to fill on Saturday nights
for most of the year and achieve high Friday night occupancies. New hotels are
however likely to result in a more competitive Sunday to Thursday hotel market in the
city, when existing hotels, certainly at the upscale/full service level are not currently
filling and turning business away. We have assumed therefore that new hotel provision
needs to be supported by growth in Sunday to Thursday demand and on the basis
that all hotels can achieve at least the current levels of Sunday to Thursday
occupancy. We have therefore run the growth projections purely on the basis of
growth in Sunday to Thursday demand.
10
Excluding the Gainsborough Bath Spa
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5.1.8. The growth projections are based on the following assumptions:
Upscale/full service hotels are not currently denying any Sunday to Thursday
business;
Sunday to Thursday denials for budget/limited service hotels are based on the
information provided by the managers of these hotels;
Sunday to Thursday demand for hotel accommodation in Bath will grow at
average annual Low, Medium and High growth rates of 3, 4 and 5 per cent11.
These growth rates assume that effective marketing and product
development strategies to grow Sunday to Thursday business will be
implemented by Bath Tourism Plus, Bath & North East Somerset Council and
individual hotels and hotel companies;
20% of the Sunday to Thursday occupancy achieved by the Gainsborough
Bath Spa, Apex and Indigo hotels will be new business generated by these
hotels because of their product, brand, marketing and central reservations;
All upscale/full service hotels will achieve a Sunday to Thursday occupancy of
70%;
All budget/limited service hotels will achieve a Sunday to Thursday occupancy
of 80%.
11
Our reference points for these assumed growth rates are as follows:
The national forecast for growth in domestic tourism of 3% p.a.
The national forecast for growth in inbound tourism of 6.1% p.a.
The average annual growth in hotel roomnight demand in Bath between 2008 and
2015 of 3.3%
Visit England's national target for tourism growth in England of 5% p.a.
The jobs growth target in the B&NES Economic Strategy of 1.05% p.a. and Core
Strategy provision for growth in office space equivalent to an average annual growth
rate of 1.28% - as proxy measures for potential growth in corporate demand
Growth is also likely in terms of contractor demand and some growth in residential
conference business and university-related demand. We have not been able to find any
suitable reference points for the potential growth in these markets however.
Our assumed growth rates for midweek demand for hotel accommodation in Bath are
intended to reflect the potential for growth in all markets - corporate, contractors,
residential conferences, university-related demand, UK leisure breaks, overseas tourists
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5.1.9. New hotels are likely to result in a more competitive hotel market in the city and could
possibly erode the average room rate performance of existing hotels. It is however
only possible to model potential future growth in demand by volume, not by value.
The assumptions that we have used, in terms of growth rates and the Sunday to
Thursday occupancy that hotels will achieve, are intended to reflect a scenario
where average room rate performance will not be unduly affected.
5.1.10. The results of our demand projections are set out in the table below.
Table 17
BATH - PROJECTED REQUIREMENTS FOR NEW HOTEL DEVELOPMENT – 2020-2030
STANDARD OF
HOTELS/YEAR
PROJECTED NEW ROOMS REQUIRED PIPELINE
ADDITIONAL
ROOMS LOW
GROWTH
MEDIUM
GROWTH
HIGH
GROWTH
Upscale/ Full Service (5 Star/ Boutique/ 4 Star)
2020 225 269 315 3301
2025 367 472 586 3301
2030 532 719 933 3301
Budget/Limited Service
2020 188 218 250 1482
2025 286 358 436 1482
2030 399 527 674 1482
TOTAL NEW HOTEL ROOMS
2020 413 487 565 478
2025 653 830 1022 478
2030 931 1246 1607 478
Source: Hotel Solutions
Notes:
1. Gainsborough Bath Spa, Apex, Hotel Indigo (net additional bedrooms)
2. Z Hotel
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5.1.11. These results show potential for a greater number of new hotel bedrooms in Bath
than was projected in the previous 2009 Visitor Accommodation Study prepared by
The Tourism Company for a number of reasons:
They take as their starting point a higher roomnight demand because:
o Hotel occupancies have increased significantly since 2008;
o The hotel supply has grown with the opening of the Premier Inn, with
only a marginal impact on some existing hotels. This hotel is trading very
well and has clearly brought substantial levels of new business to the
city and is already consistently denying significant demand.
The prospects for future growth in demand for hotel accommodation in the
city look much more positive in terms of:
o The strong growth projected nationally in the domestic leisure break
market and in inbound tourism: Bath should be a key beneficiary of
these trends;
o The likely growth in corporate demand given the plans for office
development in the city that are now moving ahead.
The pipeline hotels that are due to open in the city are likely to generate new
business because of their product, brand, customer base, national marketing,
central reservations, and potential for referral from sister hotels in London, Bath
or Bristol. We have factored this new demand into our projections.
5.1.12. We have also taken a different approach to modelling the potential future growth in
the city's hotel market, focused purely on midweek demand and assuming that all
hotels (existing and new) will maintain the current average midweek occupancy
levels. We feel that this is a more appropriate (and conservative ) approach as it
avoids overcompensating for the strengths of weekend demand in Bath and overly
diluting the midweek market for hotel accommodation in the city.
5.1.13. The projections indicate that there is a need to plan for further hotel expansion over
and above the level currently included in the Core Strategy. The table overleaf puts
our projections into that context.
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COMPARISON BETWEEN 2009 VISITOR ACCOMMODATION STUDY AND 2015 HOTEL FUTURES
STUDY PROJECTIONS
2009 Visitor Accommodation Study
Projected Additional Hotel Bedrooms
Required 2009-2026
New Hotel
Bedrooms
Opened/
Opening
2009-2016
Projected Additional Hotel
Bedrooms Required 2017-2026
Low
Growth
Medium
Growth
High
Growth
Low
Growth
Medium
Growth
High
Growth
444 599 761 6301 0 0 131
2015 Hotel Futures Study
Projected Additional Hotel Bedrooms
Required 2015-2030
New Hotel
Bedrooms
Opened/
Opening
2015-2016
Projected Additional Hotel
Bedrooms Required 2017-2030
Low
Growth
Medium
Growth
High
Growth
Low
Growth
Medium
Growth
High
Growth
931 1246 1607 4782 453 768 1129
Notes:
1. New hotel bedrooms 2009-2016: Premier Inn (108); Halcyon Apartments (8); Bailbrook House
(13); Hilton Bath City (23); Gainsborough (99); Apex (177); Z Hotel (148); Hotel Indigo (54)
2. New hotel bedrooms 2015-2016: Gainsborough (99); Apex (177); Z Hotel (148); Hotel Indigo (54)
5.1.14. Our 2015 projections show the following:
The pipeline supply of upscale/full service hotels is more than enough to meet
the projected requirement for additional supply at this level through until at
least 2020. This suggests that the new hotels that will open in the city by 2017
may result in a more competitive hotel market at this level, at least in the short
term, potentially leading to a reduction in occupancy and average room
rates, depending on how strongly the Sunday-Thursday market grows, how
much new business the new hotels generate, and the marketing and rate
strategies that existing hotels adopt to counter the impact of the new hotels.
In terms of total satisfied roomnight demand however, Bath will see a
significant boost from these new hotels.
There is likely to be potential for additional upscale/full service hotel
provision in Bath beyond around 2022/23, depending on how strongly the
Sunday to Thursday market grows.
There could be scope for up to another 202-603 upscale/full service hotel
bedrooms to open in the city to meet the demand for additional hotel
supply at this level by 2030, in addition to the 330 bedrooms that are
already in the pipeline.
There could be potential for an additional budget/limited service to open in
Bath by 2020 in addition to the Z Hotel.
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There could be scope for up to a further 251-526 budget/limited service hotel
bedrooms in the city by 2030, over and above the Z Hotel.
5.1.15. The growth projections do not model future requirements for
serviced apartments and 3 star hotels: the supplies of these categories of
accommodation are not sufficient for us to run meaningful growth
projections. Given the growing interest in serviced apartments as an
alternative to a hotel stay, with the greater space, flexibility and in some
cases value for money that they offer, we believe that there is potential
for more serviced apartment provision in Bath, and potentially an
aparthotel. With the increasing polarisation in the hotel market
between upscale, full service hotels and budget/limited service
hotels we believe that there is less potential for additional 3 star hotel
provision in Bath: indeed the city's 3 star hotel supply is set to reduce
further with the conversion of the Pratt's Hotel to the boutique Hotel
Indigo.
5.1.16. Making any sort of market forecasts is an uncertain process: all
forecasts are based on judgement and assumptions, and are
susceptible to unforeseen changes. The projections we have prepared
should thus be taken as indicative only and should be reviewed at
regular intervals. They have been prepared to provide an illustration
of the numbers of new hotel bedrooms that might be needed
under different growth scenarios. Clearly the further ahead that one
looks, the more difficult it is to project growth accurately. The
projections to 2025 and 2030 should thus be treated with caution and
should be periodically reviewed and revisited, particularly as new
supply comes on stream.
5.1.16. The growth projections and requirements for additional hotel
provision that they show do not take account of the potential impact
of new budget/limited service hotels on the city's remaining 2 and 3 star
hotels, Bath's guest house and B&B sector, or hotels in surrounding
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areas. In planning the expansion of hotel provision ongoing support for
this sector needs to be considered and is included in our conclusions
and recommendations in Section 6.
5.2 Hotel Developer & Operator Interest in Bath
Introduction and Approach
5.2.1. Testing hotel developer and operator interest in a destination brings a live perspective
on hotel investment from the sharp end of those endeavouring to deliver new hotels
here. It is an opportunity to probe perceptions of the city and hotel market, specific
brand interest and locational preferences, gain feedback on any sites reviewed, and
a view on the obstacles to gaining representation here.
5.2.2. By way of context, we initially provide below some ‘scene setting’ in terms of the
impact of the performance of the economy on hotel development, followed by an
outline of hotel business models and funding routes, which should help to explain the
hotel developer and operator responses, particularly in terms of the challenges faced
to get new hotels off the ground.
The Economic Backdrop
5.2.3. Hotel performance and the hotel investment cycle is closely linked to trends in the
national and local economy and so the economic downturn that began in 2008 and
the subsequent climb out of recession has hit the sector in several ways. Hotel
performance fell back with occupancy dropping below 70% from 2009, only
recovering to pre-recession levels in 2013. In terms of achieved room rates, they have
taken until 2014 to recover to these levels. The drop in performance affected end
values in some cases to the point where it would cost more to build a hotel than its
value, resulting in hotel investors holding back on new build schemes until yields
improved. This has made funding more difficult to secure, especially for small hotel
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companies and franchisees, and when available often on less favourable terms, with
less debt funding and more equity required. These trends have had implications for
the type of new hotel being delivered, favouring conversions and re-brandings
alongside refurbishment and improvement, encouraged by the ability to buy existing
hotel stock at less than replacement value.
5.2.4. As a result of this risk-averse climate, many hotel companies are now focusing on
asset-light development strategies that don’t involve them in capital outlay. A
number of 4 star and luxury international brands have for some time only done
management contract deals, but certainly their prevalence has spread as funding
has become more difficult to secure. These schemes involve significant levels of
investment and what the operator brings to the table is their sector expertise and
brand strength. This reinforces an earlier trend in the sector pre-recession, for hotel
companies to divest themselves of their property assets whilst retaining the contract to
operate – Hilton and Accor are good examples.
5.2.5. Whilst funding 3 and 4 star hotels has been a challenge during the economic
downturn, budget hotel development has continued apace: Travelodge and Premier
Inn have remained active, offering the advantage of their ability to take lease deals in
developer-led schemes. One advantage of the downturn in the property market has
been that residential and some commercial sites have come forward for hotel
development that would not previously have been available or affordable. A weaker
market has also seen some distressed hotels coming onto the market being bought up
by chain hotel companies and re-branded. London has also been a key focus of
hotel development interest, driven by strong performance and the 2012 bounce.
5.2.6. PwC, one of the UK's leading hotel consultancies, identifies a solid return to revpar
growth as critical to de-risking hotel investment; with revpar having turned the corner
in 2014, access to finance should improve and the pace of new hotel development
should accelerate. Growth will vary between regions and segments, with London
likely to continue to see the highest growth in supply, and key regional cities having
the largest active hotel development pipelines. The structural shifts that have taken
place continue to squeeze the middle, with budget hotels making up 50% of total
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pipeline schemes identified in PwC’s hotel forecast, and the four and five star
segment accounting for almost 40%.
5.2.7. In overview, the Credit Crunch and recession have inevitably had an impact on
slowing the development plans of hotel companies, and seen new routes to delivery
emerging. The upturn in the hotel market and economic growth looks likely to
improve the climate for hotel investment, though in counterbalance the upturn in
demand from residential and office markets will mean greater competition for land,
making it harder and more expensive to acquire sites.
Hotel Business Models & Funding Routes
5.2.8. Hotels can be developed and operated under a number of different business models
(summarised in the table overleaf) with hotel brand owners, franchisees and property
developers playing different roles in each case, with development and operating risks
shifting under the different models.
5.2.9. The levels of capital outlay as well as development risk required by a hotel company
therefore vary considerably between these options. Many more hotel operators,
particularly at the 4 star level, which is much more capital intensive, are likely to be
interested in options put to them that involve management contracts than in building
and funding hotels themselves, as access to capital will naturally restrict the latter and
require hotel companies to prioritise their investment locations.
5.2.10. Many of the chain hotel companies will have a mix of the above structures in place,
though some do prefer a single route. Often franchisees are looking to build the asset
value of the company with a view to exit within a 5-10 year period, and in such
situations are less likely to be interested in lease options.
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Table 18
HOTEL DEVELOPMENT & OPERATING MODELS
Hotel Development/Operating Model Property
Company Risk
Hotel Company
Risk
Hotel company (hotel brand owner) develops the
hotel & subsequently operates and markets under
one of its brands
e.g. Whitbread builds and operates a hotel under
its Premier Inn brand
x √
Hotel company (hotel brand franchisee) develops
the hotel then operates and markets under a hotel
brand through a franchise deal with a hotel brand
owner
e.g. Sojourn Hotels builds a hotel and operates it
under a Hampton by Hilton franchise agreement
with Hilton Hotels
x √
Property company develops the hotel & seeks a
hotel company to lease the hotel
e.g. Equity Estates builds the hotel and leases to
Travelodge
√ √
(depending on
the type of
lease)
Property company develops the hotel & seeks a
hotel company to purchase the freehold of the
hotel
√ x
Property company develops the hotel & employs a
hotel company to manage the hotel under a
management contract
√ √
(some
depending on
the terms of the
management
agreement)
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5.2.11. Lease models require a little more explanation, as there are some key issues
surrounding lease structures that are impacting upon the ability to deliver hotel
developments currently. Developers require hotel operators to take a fixed lease, a
standard institutional lease that will give a guaranteed fixed payment per room
over a period of 20-30 years. Once secured, this guaranteed income stream makes
the development fundable, and the developer can secure finance on the back of
this. On completion the developer may retain or sell the investment. Currently, only
Travelodge and Premier Inn are able to take such leases, as only they have the
strength of covenant required. One or two of the multiple brand chains have taken
leases, but generally these will only be for large hotels in premium locations such as
London or Edinburgh, where occupancy and high rates are guaranteed. There are
accounting implications of fixed leases also, as they represent a financial
commitment going forward, and this has also put hotel companies off this model.
5.2.12. More favoured by hotel companies are variable leases, made up of a combination
of base rental and a share of turnover. Some guarantees can be built into these
arrangements, but should the market fall back, the risk and impact is shared by the
developer/funder and the operator. Their responsiveness and flexibility accounts
for their appeal to hotel companies. Certainly in previous recessionary climates,
fixed leases have contributed to the downfall of hotel companies, as they became
unable to meet their rental commitments when trading performance fell back.
However, there is evidence that these turnover leases make it difficult to fund
development because they don’t give the same fixed income stream.
5.2.13. The differing objectives and requirements of developers/investors and operators has
led to something of an impasse and resulted in it being difficult to get hotel
schemes off the ground. During our consultations with hotel companies we have
come across numerous schemes and sites that have stalled for this reason, with few
hotel operators able or willing to do the sort of deal the funding institutions require.
5.2.14. The funding climate and the changes in the way that hotels are being delivered
has had an impact on the development strategies of hotel companies, with
schemes increasingly developer and/or investor-led. Many hotel developers and
operators have stopped having target lists of locations where they would like to be,
rather considering schemes on an individual basis, if they are live. Many are willing
to respond to specific sites and schemes, and to work with a developer on sites and
locations to determine the strength of the market and the most appropriate brand
to consider. From a destination or landowner point of view, the response should be
about making the case and evidencing the potential.
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5.2.15. The difficulty in securing funding for hotel schemes has also led to other
interventions being used to secure hotel schemes. Local authorities have begun to
provide funding to support the development of hotels as part of strategically
important mixed-use schemes and the conversion of architecturally important
buildings to hotels. In Hampshire, Eastleigh Borough Council has funded the
development of a new Hilton as part of the development of the Ageas Bowl cricket
ground on the edge of Southampton. In Newcastle, the City Council has borrowed
£30m to help fund the development of a 250-bedroom 4 star Crowne Plaza as part
of the first phase of the Stephenson Quarter regeneration scheme. Travelodge has
been working with a number of local authorities nationally, where the Council has
invested in the hotel; an example is the Redhill Travelodge and town centre mixed
use scheme in Surrey. IHG have also worked on several projects involving Council
funding of hotels, most recently for Holiday Inn and Holiday Inn Express hotels in
Stockport and Blackpool. In each case the Council has funded, developed and
owns the hotel – or bought it back off the developer – and taken a franchise with
IHG, with an option to put in place a management company.
Assessing Hotel Company Interest in Bath - Sampling and Approach
5.2.16. In order to establish the likelihood of bringing hotel development forward in line with
the market potential identified, Hotel Solutions undertook a hotel developer and
operator testing exercise, via structured telephone interviews with the Acquisitions
Directors of the major hotel brand owners in the UK. In determining which to
target, we took account of the market findings, gaps in representation compared
to comparator heritage cities, known past interest in Bath and hotel offers known to
be active in the market currently, particularly emerging and innovative brands new
to the UK.
5.2.17. Over 25 hotel developers, operators and investors were contacted; a full list
together with responses can be found at Appendix 4. A number of these hotel
companies operate multiple brands, ranging from budget through to luxury offers,
enabling a wider view on potential to be gleaned and also some insight into the
requirements for hotels at different levels in the market, particularly in terms of
performance (occupancy and achieved room rate)
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Interest by Standard
5.2.18. At the time of writing, a total of 20 hotel companies had responded, with 18
expressing interest in Bath. Two were not interested in being represented in Bath, the
principal reasons being:
A lack of corporate demand in volume;
A weakness in the mid-week market;
The length of time taken to progress sites and schemes in Bath.
5.2.19. This interest represented an even wider number of brands – 44 in all, 47 if we include
new brands already committed to the city1 - which by standard and type of offer
covered the whole spectrum of provision. Several were prepared to place multiple
brands in Bath at different levels in the market. A summary of interest by brand and
standard is presented in the table below.
Table 19
HOTEL COMPANY INTEREST IN BATH – BY STANDARD
LUXURY/5 STAR 4 STAR
BOUTIQUE/
LIFESTYLE
3 STAR
Luxury Collection Apex1 AC by Marriott Courtyard by Marriott
Renaissance Crowne Plaza Bespoke Four Points
Quorvus Doubletree by Hilton Hotel du Vin Hilton Garden Inn
Wyndham Golden Tulip Hotel Indigo1 Holiday Inn
Autograph Marriott Malmaison Ramada
Mercure Radisson Red
Novotel
Radisson Blu
Ramada Plaza
Tribute
Village
BUDGET
BOUTIQUE
UPPER TIER BUDGET BUDGET EXTENDED STAY
Nadler Express by Holiday Inn Days Inn Adagio
Aloft Hampton by Hilton Ibis Beyonder
Moxy Ramada Encore Premier Inn (2) Bridge Street
Sleeperz Tryp Travelodge Residence Inn
Z Hotel1 SACO
Ibis Styles Staybridge Suites
Notes:
1 Already committed to Bath/ under construction
Italics – awaiting final confirmation pending initial feedback
1 Apex, Hotel Indigo, Z Hotel
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5.2.20. It is notable that a significant proportion of this interest is for upscale brands and
brands that many locations outside London cannot support, including some luxury
offers.
Interest by Company
5.2.21. The table overleaf summarises brand interest by hotel company, and minimum size
required.
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Table 20
HOTEL COMPANY INTEREST IN BATH - BY COMPANY
COMPANY
BRAND STANDARD SIZE
(Rooms) Accor Novotel 4 star 150-200
Mercure 4 star 80-160
Adagio Extended stay 70
Ibis Styles Budget Boutique 100-200
Ibis Budget 100-200
Bespoke Bespoke Boutique 70+
Bridge Street Bridge Street Extended stay 50-120
Frasers Hospitality Hotel du Vin Boutique 45
Malmaison Boutique 100+
Hilton Doubletree 4 star 80-150
Hilton Garden Inn 3 star 100-150
Hampton by Hilton Upper tier budget 100-150
IHG Staybridge Suites Extended stay 75+
Crowne Plaza 4 star 150-200
Holiday Inn 3 star 120-150
Express by Holiday Inn Upper tier budget 150+
KSL Capital Village 4 star 150+
Louvre Golden Tulip 4 star 100+
Marriott Autograph Luxury 100+
AC by Marriott Boutique 100-120+
Marriott 4 star 150-200
Renaissance Luxury 150-200
Courtyard 3 star 175-200
Moxy Budget Boutique 150
Residence Inn Extended stay 125
Nadler Nadler Budget Boutique 100-120
Rezidor Quorvus Luxury 75
Radisson Blu 4 star 125-175
Radisson Red Lifestyle 125-150
SACO SACO Extended stay 100+
Beyonder Extended stay 100+
Sleeperz Sleeperz Budget Boutique 100-120
Starwood Luxury Collection Luxury 80+
Tribute 4 star 100+
Four Points 3 star 100-120
Aloft Budget Boutique 110+
Travelodge Travelodge Budget 150
Whitbread Premier Inn Budget 60-120
Wyndham Wyndham Luxury 60-200
Ramada Plaza 4 star 60-200
Ramada 3 star 60-200
Tryp Upper tier budget 60-200
Ramada Encore Upper tier budget 60-200
Days Inn Budget 60-90
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Other Requirements
5.2.22. In terms of other requirements of hotel developers and operators:
Size
o Requirements varied between brands, with some brands having
harder brand standards, and others being more flexible on physical
attributes of the building and offer. For most, the minimum size of
hotel would be 100 bedrooms, but in fact many were looking to place
larger hotels in Bath to spread the high development costs of
delivering here across more bedrooms. Quantum here is key to
making it stack up. Those that would deliver smaller hotels were
generally either budget or boutique/luxury and more niche offers.
Location
o Most hotel companies wanted to be as central as possible, with the
station and Roman Baths being pointed out as reference points.
Being a tight city centre, most took the view that sites coming forward
were likely to be reasonably accessible/close to the centre. The
Holiday Inn Express on Lower Bristol Road is seen as the furthest
walkable point for a hotel to be located.
o Given the difficulty of securing sites in Bath, many were prepared to
consider other locations on the edge of the centre or even beyond.
One of the advantages of such locations was seen to be the potential
availability of car parking, which is difficult to secure on site in the city
centre. The budget operators were flexible about edge of centre
locations, particularly as they have representation in the city centre
already.
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Deal
o Some hotel companies have very rigid business models where they do
not purchase but work with an investor and then manage, examples
being Rezidor and Starwood.
o Some only want freehold deals e.g. Hotel du Vin.
o Whilst Premier Inn and Travelodge have led the way in being able to
take on FRI leases – almost exclusively at one point – a number of
other operators indicated that they would consider a lease in Bath,
which is a reflection of the strength of the market and asset values
here. Examples include Marriott and Nadler.
o Management contracts could also be supported by other forms of
financial support here such as key money, subordinated loans, small
pieces of equity and financial guarantees.
o New build, conversion and acquisition options would be considered
by most hotel companies in Bath, given the difficulty of securing a site
here. This would include re-positioning existing hotels, and converting
office blocks. Most companies would go into mixed use schemes.
The Ability to Generate New Demand and Add Value
o Several brands indicated their potential to help grow the market in
Bath through generating new demand by their brand presence. This
included:
Hotel du Vin and Malmaison who have their own following;
Nadler also on a smaller scale, but with quite an international
following and Millennials focus.
Rezidor felt that their international branding would draw in
upmarket overseas visitors and residential conferences,
especially in the off-season.
Village has a strong leisure offer that can generate leisure breaks,
but also serves the corporate market through its large business
centre facilities. This brand also appeals to the family market.
Louvre have new owners, the Jin Jiang group, which enables
them to access the growing Chinese market.
Starwood has the 4th largest membership loyalty database in the
world and great leisure demand for the UK which is currently
untapped in Bath.
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What Hotel Companies Say About Bath
5.2.23 This is what some of the Acquisition Managers of key hotel development,
investment and operating companies had to say about Bath:
‘We would crawl over hot coals to find a suitable site in Bath to turn into a
hotel. We would look at anything, we are really keen to get back into the
city’
‘Bath is an excellent market, largely driven by tourism. Due to strong
restrictions on new development, the supply/demand balance has
historically resulted in strong hotel performances’
‘Given the upmarket and international nature of demand for Bath, our
interest would be in 4 and 5 star hotels. To bring in something lower would
be to under-utilise the opportunity'
'Bath already has a good inventory of old, traditional hotels. What the city
needs is newer hotels with modern levels of services and facilities, including
those that can accommodate reasonably sized conferences and functions’
‘Given the shortage of well situated, good–sized sites in Bath we would
consider multiple options – mixed use or standalone, acquisition of an
existing hotel, or conversion of a building to hotel use’
‘Our upscale brand has the correct market positioning to capture the
potential trading levels achievable’
‘This is one of the few provincial markets that would support a full service
hotel; a compelling economic case’
‘Bath is a real destination and a great market with excellent trading
performance’
‘Bath is a ‘must have’ city’
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Obstacles to Securing a Site and Delivering a Hotel Scheme in Bath
5.2.24. Bath was ubiquitously described by the hotel development market as a high barrier
to entry market, much like Oxford and Cambridge. The key challenges are
summarised well in the response from one multiple brand owner when asked what
were the main obstacles:
‘All of the usual ones, in large quantity! : lack of sites, small sites, building
restrictions, difficulty with planning, expensive. However, all of this is
acceptable to a degree as it protects the city and preserves the elements
which make it so attractive’.
5.2.25. The difficulty is when these come together to burden a hotel scheme to such a
degree that it becomes difficult to make a hotel development stack up, even with
the high levels of performance achieved in the city:
‘The London effect of increasing costs is rippling outwards making it difficult
to get upscale hotel schemes to stack up
5.2.26. Not only are there issues in relation to enhanced costs associated with converting,
renovating or re-positioning a character building in a sensitive cityscape, but also
the price of sites and buildings, which is made worse by competition from
alternative, higher value uses. The competition presented by the demand for,
returns on, and ability to finance student accommodation and other forms of
residential accommodation are a particular challenge, likely to worsen now that
the economy and market has picked up. There was also mention of competition
from office uses and associated issues around the retention of employment land
and retention of employment from office conversions, which presents a challenge
for conversions to budget hotels, which are unlikely to generate the same numbers
of jobs as offices previously did.
5.2.27. Clearly, Bath has great appeal as a hotel investment location but also represents a
great challenge. The quote below from an international multiple brand owner
demonstrates the positive and negative perceptions and realities of developing
hotels in and around the city.
We would deploy and of our brands into Bath, but these opportunities here
are like pulling hens’ teeth!’
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5.3 Hotel Site Availability
5.3.1. The availability and deliverability of suitable hotel sites will clearly be a key
determinant of future hotel development in Bath, and featured large amongst the
obstacles identified by hotel companies above. Site assessments work has not
been part of the brief for this consultancy commission; in 2009 this was an additional
module of work undertaken that then enabled some matching of market potential,
site requirements (of hotel companies), site suitability (the characteristics of these
sites), and destination objectives in each case. However, we would make the
following observations in relation to the sites situation and hotel development
potential:
There are a lot of good sites and buildings in Bath with potential for hotel
development. Land and property values are however very high and
competition from higher value uses is fierce, presenting real challenges for
hotel companies that want to open new hotels in the city. Policies that seek
to manage the loss of office floorspace in the city centre may also make the
conversion of suitable redundant office buildings to budget hotels difficult,
particularly in terms of the requirement to deliver a similar level of alternative
employment opportunities.
Some sites with potential and/or planning for a hotel use have not
happened for a variety of reasons e.g. value, competition, cost, complexity
of delivery.
There are currently no sites allocated solely for hotel development.
The process of preparing the Placemaking Plan presents a window of
opportunity to build hotel requirements into the plan making process, with a
series of major redevelopment sites potentially coming forward.
Hotels are being included in some mixed use schemes as part of the
Placemaking Plan Options Document, with Bath Quays North and Manvers
Street being the notable ones; but these will only partially address the
identified potential and the hotel element could get squeezed out of mixed
use schemes by higher value uses.
There are limits to how much the planning system alone can steer and
influence future hotel development, particularly as a hotel use covers a
broad range of offers.
A hands-off approach may well result in the city not getting the hotel offer it
deserves, or the offer that is wants to help build the destination for the future.
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The market potential at high growth rate could require up to 7-9 hotel sites
to deliver the volume of rooms required;
An option might be to plan proactively now for a further 3-4 new hotels
(beyond the pipeline hotels that will have opened by 2017) to meet the low
growth projections, prioritising the locations that the Council most wants to
see delivered, and then either leave the delivery of the balance to the
market, or review the situation in 5-6 years taking account of the ongoing
and projected demand for hotel accommodation at that time. The risk in
this approach is that a future review could find further requirements for hotel
expansion that cannot be met as the potential sites for new hotels may
have gone to alternative uses.
Pro-activity alongside planning presents more of an opportunity to influence
the location and type of hotel development, and might include any
combination of working with hotel developers, working with site owners,
promoting Council owned sites for hotel development as well as the
planning tools of allocation, safeguarding and feeding hotel uses into
Masterplans;
In order to effectively intervene with a pro-active approach, there is a need
for a defined hotel investment strategy based on a clearly articulated role
for hotels to support both visitor economy targets and wider destination
objectives;
From here it should be possible to prioritise and match brands and sites that
can best help deliver these aims over short, medium and long term
timescales.
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6. CONCLUSIONS & RECOMMENDATIONS
________________________________________________________________________________________
6.1. The Requirements & Potential for Hotel Development in Bath
6.1.1. Our research findings show potential for significant hotel development in Bath both
in terms of market potential and hotel company interest. The key question is how
much of this potential does the city want to accommodate and at what level in
the market? The answers to these questions will depend on the future strategy for
Bath as a visitor destination:
If the city wants to grow staying tourism volumes, it will clearly need more
hotel provision. With hotels trading at such high occupancies for much of
the year growth in staying tourism will need to be largely supply led. There is
otherwise little hotel capacity to support staying tourism growth. The
quantum of new hotel provision needed will depend on the targets for
growing Bath's staying visitor market. The type of new hotel provision
required will depend on the markets that the city wants to attract.
If the city wants to convert more day visitors to staying visitors it will need
more lower-priced hotel accommodation that is affordable for the visitors
that currently stay in hotels in surrounding locations and commute into Bath
as day visitors.
If the city wants to attract more companies it will need a greater supply of
hotel accommodation at a price point that companies can afford to pay
for single occupancy room rates.
If Bath is to remain competitive as a staying visitor destination it will need a
good mix of high quality, contemporary hotel accommodation, including a
strong independent hotel offer. Care is needed to avoid undermining the
independent hotel sector, which is a key part of Bath's distinctiveness as a
place to stay.
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6.1.2. Our assessments of the requirements and potential for additional hotel provision in
Bath show no immediate requirement before 2020 for additional upscale/full
service hotel provision, beyond the Gainsborough Bath Spa and pipeline Apex and
Indigo hotels. The market needs to absorb this new supply first. There remains very
strong interest however from hotel companies and independent hoteliers that
would like to open upscale hotels in Bath. There is no need to deter this interest, but
no need either to actively encourage it. Further upscale hotel development should
be left to the market to determine.
6.1.3. Our growth projections show that Bath should be able to support another
budget/limited service hotel within the next 5 years, in addition to the Z Hotel.
Beyond 2020 we are also showing potential for further budget/limited service hotels
through until at least 2030.
6.1.4. There are good reasons for encouraging budget/limited service hotel development
in Bath:
There is clear demand/potential for more budget hotels in Bath;
Budget brands will generate new business for the city as a result of their
brand strength and customer base, national marketing, central reservations
and referral business from sister hotels;
Budget hotels will provide a more affordable option for the corporate
market, contractors, overseas tourists and UK leisure visitors - potentially
helping to convert day visitors that stay in hotels in surrounding areas to
staying visitors;
Budget hotels will contribute to the evening restaurant economy in the city
as they have limited food and beverage facilities;
Budget hotels can offer a good use for redundant office buildings;
Budget hotels can have a good fit for less attractive and less well located
sites;
There is a much greater chance of delivering budget hotels through lease
deals;
With their lower staffing levels and limited food and beverage provision,
budget hotels are less likely to exacerbate the problems that many of the
city's hotels face in terms of staff recruitment, particularly for chefs.
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6.1.5. There are also some negatives as to why significant budget/limited hotel
development might not be so good for Bath :
New budget hotels could impact negatively on the city's remaining 3 star
hotels, its guest house and B&B sector and hotels in the surrounding area.
More budget hotels may attract more stag and hen parties;
Budget hotel operators tend to want to implement their standard models
and designs which may not be acceptable in a sensitive historic landscape;
however, with such high returns at stake, there should be some flexibility for
suitable changes to be negotiated through the planning system without
impacting too negatively on project viability;
Budget hotels will create fewer jobs - although this can also be seen as a
positive as they will not therefore add significantly to the staff recruitment
challenges that the city's hotel sector already experiences.
6.1.6. Care is therefore needed to attract budget/limited service hotel products and
brands that will add to the city's hotel offer. Perhaps the focus should be more on
attracting upper-tier budget brands e.g. Hampton by Hilton, and/or some of the
new budget boutique brands e.g. Moxy and Aloft.
6.1.7. Our research also suggests that there is market potential for additional serviced
apartment provision in Bath, and possibly an aparthotel. This type of supply would
broaden the city's hotel offer. It would appeal to the corporate market, especially
to longer staying corporate visitors. It is also becoming increasingly popular with
leisure visitors as a result of the greater space, flexibility and sometimes value for
money that it can offer. Serviced apartments have particular appeal to families
and overseas tourists for these reasons. The only potential negative from an
increase in serviced apartments is that they also appeal to the hen party market.
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6.2. Tackling the Sites Issue
6.2.1. The availability of suitable and affordable sites for hotel development is the key
barrier to growing Bath's hotel supply. Relatively few sites come up and there is such
strong competition from student accommodation and residential development
against which a hotel use cannot compete on value. How best to address this issue
should be a key consideration for the Council. There are two key roles that it could
play if it wants to intervene proactively to address the hotel sites issue:
As landowner and developer/investor - many of the key regeneration/
development sites in the city centre are in total or partial Council ownership.
The Council thus has more control over the type of uses that these sites go
for, and in the type of hotels that could be included in development
schemes (if a hotel use is seen as appropriate within the mix).
By working with land and property owners to bring forward sites and
buildings that would be suitable for hotel development and match them
with key target hotel products and brands that will help to achieve the
strategy for growing staying tourism in the city (whatever that looks like
when finally agreed).
6.2.2. As hotels are defined a city centre use, the Council is unable to influence the
standard and type of hotel that might be brought forward in the city centre from a
planning perspective. It only has control over the scale, design and impact of city
centre hotel schemes. Its other main influence on hotel development from a
planning point of view is in terms of preventing or limiting hotel development in
outer areas through a stringent application of the sequential test.
6.2.3. If the Council decides to take either or both of the more interventionist approaches
to addressing the hotel sites issue discussed above, there are two aspects to
consider - the timing of when hotel development needs to come forward, and a
locational strategy for different types and standards of hotel, to optimise the use of
available sites and to achieve the strategy for staying tourism growth.
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6.3. The Timing of Hotel Development
6.3.1. In an ideal world new hotel development would be phased to coincide with
market growth to avoid any undue impact on existing hotels. In reality this rarely
happens; hotel development is usually cyclical. In most hotel markets hotel
performance builds to a point where developers decide that there is potential for
them to open new hotels. Depending on the strength of the market opportunity a
number of new hotels may open in quick succession. Hotel performance will
generally drop back a little following new hotel openings, depending on the scale
and timing of new provision coming on stream and how strongly the market is
growing. Hotel demand and performance will then build further until such time as
further new hotels can be supported.
6.3.2. In terms of the timing of new hotel development in Bath we make the following
observations:
The most immediate requirement is for another budget/limited service hotel
or an aparthotel.
Additional upscale/full service hotel provision will not be required much
before 2022/23.
The phased release of sites in the Enterprise Area, some of which could
incorporate a hotel, provides an opportunity to exert some control on when
hotel schemes might come forward; the trick will be to tie this in with the
market need in terms of the most appropriate type of hotel with both
market and destination/scheme fit.
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6.4. A Locational Strategy for Hotel Development in Bath
6.4.1. In terms of a locational strategy we would suggest the following:
Prime sites in the historic core of the city centre should be prioritised for
upscale/full service hotel development;
Budget/limited service and aparthotel development can be more
appropriately developed on and steered towards edge of city centre and
riverside sites;
There could be a case for considering budget hotel development in outer
locations that are well served by bus routes;
Buildings of character should be used for boutique hotels;
Redundant offices may be more suited for conversion to limited service
hotels, but might also present redevelopment rather than conversion
opportunities where more development/a better site solution and scheme
could be achieved.
6.4.2. Once the locational strategy has been agreed, it will be important to
communicate it to stakeholders, including site owners and hotel companies; act on
it as a Council where direct intervention is achievable (e.g. where the Council is a
full or partial site owner and/or could act as the developer / investor for a scheme
that includes a hotel); and where possible build it into policy and strategy making,
in order to give direction to the market about what the Council is looking to see
delivered in terms of new hotel provision
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6.5. Implications for the Placemaking Plan
6.5.1. In finalising the Placemaking Plan we would suggest the following:
There is a need to plan for a greater number of additional bedrooms in the
city centre than is identified in the Core Strategy. This Hotel Futures update
presents the market evidence and rationale to do so, with clear links to the
previous work and the context of a much improved climate for investment.
Including the suggested locational strategy for hotel development within
the Plan should be considered as one route to directing and giving clarity
to the hotel development market.
Further work is needed to more closely assess the suitability of key
regeneration sites to the requirements of hotel developers and operators,
and to match best fit hotel products and brands in each case.
It may be appropriate for the Placemaking Plan to consider removing or
relaxing the requirement for office conversions to deliver an equivalent
number of jobs, which will be a significant barrier to hotel conversion,
particularly at the budget/limited service level.
6.6. Supporting Existing Hotels, Guest Houses and B&Bs
6.6.1. Our final recommendation is that the Council needs to support existing (and
new)hotels, guest houses and B&Bs through the following measures:
Effective management, maintenance and improvement of the city's public
realm fabric;
Further development of the city's visitor offer to maintain and broaden its
appeal as a visitor destination and help encourage longer stays;
Effective marketing of Bath as a visitor destination, focused on boosting
Sunday to Thursday business, particularly during the winter;
Bringing forward office development to grow corporate demand for hotel
accommodation in the city.
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6.7. Moving Forwards
6.7.1. In terms of moving ahead, there are a number of modules of work that were
discussed in the run up to commissioning the current study that could be of benefit
in refining outputs and forward action. These include:
Fleshing out the locational strategy on the ground, in terms of more detailed
assessment of sites and matching best fit hotel products and brands. This
could be expanded to include the identification and assessment of
additional sites with potential for hotel development, both within Council
ownership and privately owned. Both strands would involve working with site
owners to communicate and deliver the hotel investment strategy.
Targeting best fit brands, with a particular focus on those that can most help
deliver the required growth in staying tourism and help grow the Bath hotel
market in terms of generating new demand and attracting new markets.
This might include some additional targets dependent upon the
understanding that comes out of the more detailed sites work.
Feeding into more detailed financial and physical appraisals being led by
other consultancy teams but requiring a specialist input.
Modelling the potential impact of additional budget/ limited service hotel
provision on Bath’s independent guest house sector. This will be important to
understand to identify any need to try to support this element of the city's
accommodation supply in the face of increased competition.
The Council has indicated that they are reviewing their assets and options
for investment; if hotel investment could be on the agenda, either as an
owner or on a JV basis, it would be valuable to gain some insight into what
other Councils have done in this field. Through intelligence gathered it
would be possible to produce a paper providing both an overview of the
types of interventions other Councils have undertaken, together with some
more detailed case studies that get under the skin of specific investment
and intervention scenarios.
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6.8. Concluding Remarks
6.8.1. This is a time of great opportunity for B&NES Council to shape the future of the city in
the interests of its long term viability, sustainability and well-being. The visitor
economy undoubtedly has a key role to play in this, but without increased hotel
capacity will be unable to support the city in fulfilling its potential for staying tourism
growth. With such strong hotel performance in the city; the levels of hotel
developer, investor and operator interest in opening new hotels here; and an
emerging development framework that involves planning for major areas of
change, there is a real opportunity to help overcome the obstacles to delivery
faced by hotel developers. This is a unique opportunity that it is critical to get right,
using the evidence from this Hotel Futures Study as a basis to inform and guide
forward planning.
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APPENDICES
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APPENDIX 1
BATH - HOTELS INTERVIEWED
Establishment Face-to-
Face/
Telephone Abbey F
Bailbrook House F
Bath Priory T
Combe Grove T
Francis F
Holiday Inn Express T
Lansdown Grove F
Pratt's F
Premier Inn Bath City F
Queensberry F
Royal Crescent F
Royal F
SACO Serviced Apartments T
Haringtons F
Travelodge Bath Central F
Travelodge Bath Waterside F
Redcar F
The Halcyon F
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APPENDIX 2
GLOSSARY OF HOTEL DEFINITIONS
Budget Hotel
A limited service hotel providing a basic, good standard en-suite bedrooms, with limited in-
room facilities, services and extras e.g. toiletries, and minimal hotel facilities other than a
breakfast room and possibly a bar and restaurant.
Brand examples include Travelodge, Premier Inn, Ibis, Tune
Upper Tier Budget
A limited service hotel that offers a higher specification room (3 star equivalent) than a
budget hotel, with an integral bar/restaurant and limited meeting rooms; also sometimes a
small gym/fitness room. They tend to be larger hotels of 100-120 rooms and will locate both
on the approaches to towns if close to business/leisure drivers, in town/city centres, and
close to major communications drivers such as airports.
Brand examples include Holiday Inn Express, Ramada Encore, Hampton by Hilton.
3 Star
A full service hotel that offers a restaurant and bar also open to the public, usually
function/conference/banqueting facilities, and often leisure. Branded offers would tend to
be 120-150 rooms+, but independent hotels may be smaller in size. Will locate in city
centres and out of town where there are significant drivers of demand such as business
parks.
Brand examples include Village, Holiday Inn, Courtyard by Marriott, Hilton Garden Inn,
Ramada
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4 Star
A full service hotel but with a higher specification and larger bedrooms than 3 star hotels,
usually offering bath and shower, telephone, internet connection, and a wider range of
services including full room service and porterage, and 24 hour reception. A quality
restaurant, bar, a range of meeting rooms and business services, and a health and fitness
centre. These tend to be large hotels, over 150 rooms, and sometimes up to 250 rooms+.
Major city centres are the preferred locations.
Brand examples include Marriott, Crowne Plaza, Hilton, Radisson Blu, Apex
5 Star
A luxury, full service offer, with highly personalised service/high staffing levels, fine dining
and luxury throughout the offer.
Brand examples include InterContinental, Renaissance, Radisson Edwardian
Boutique Hotel
Relatively small (30-50 rooms), high quality, individual hotels that feature contemporary
design and a good food offer. They are often independent hotels or part of small chains
that bear the signature of their founder. However, national brands are beginning to
emerge that are larger format units (100+ rooms) and compete with 3 and 4 star hotels but
achieve a premium on their rate due to their style and service.
Brand examples include Malmaison, Hotel du Vin, ABode, Hotel Indigo, Chapter
Lifestyle Hotel
A new generation of hotel that offers casual hospitality in a smartly designed, high-tech
and modern environment. Hotels feature sleek, contemporary design, relaxed public areas
for guest check-in, mingling and relaxing; a 24/7 freshly prepared food offer; and
bedrooms with a modern and high-tech fit out.
Brand examples include: Radisson Red, Hyatt Place
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Budget Boutique
A hotel with similar qualities to a traditional boutique hotel, particularly in terms of being
design-led, but pitched at the mid-market and with less emphasis on levels of service.
Brand examples include Moxy, Aloft, Ibis Styles, Z Hotels, Hub by Premier Inn, Citizen M,
Motel One
Aparthotels, Suitehotels and Serviced Apartments
A new generation of hotel accommodation that combines an element of self-catering
through the provision of a kitchen in each unit, together with hotel services, including
reception, daily cleaning, linen, toiletries and a hotel-style booking system. They are
generally aimed at the extended stay market, and whilst they can offer rooms from one
night upwards, most request a minimum stay. Some are purpose-built units in one
ownership; others are individually owned and managed by an agency. Brands such as
Staybridge Suites will also provide a limited food offer e.g. buffet style breakfast.
Brand examples include Staybridge Suites, Residence Inn, Beyonder, Bridge Street
Worldwide, SACO.
Occupancy Rate
The percentage of all rooms sold as a proportion of all rooms available in that period.
Achieved Room Rate (ARR)
The net average amount of rooms revenue that hotels achieve per night per room let after
deduction of VAT, breakfast (if included), discounts and commission charges. Hotel rooms
revenue divided by the number of rooms sold.
Revpar
Revenue per available room. The net average amount of rooms revenue that hotels
achieve per night per available room after deduction of VAT, breakfast (if included),
discounts and commission charges. Hotel rooms revenue divided by the number of rooms
available in the hotel.
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APPENDIX 3
HERITAGE CITY HOTEL STOCK & DEVELOPMENT COMPARISONS
________________________________________________________________
The following appendices (Appendix 3a-3e) present comparisons of current (July 2015) hotel
supply, changes in hotel supply between 2009 and 2015, and planned hotel development in
Bath and other comparator heritage cities in England.
The comparator cities are as follows:
Oxford
Cambridge
Chester
York
Exeter
The comparisons cover star-rated, branded and non-inspected hotels with 10 or more
bedrooms. 5 star guest houses and serviced apartment complexes/ aparthotels with more
than 5 apartments are also included in the analysis. Small serviced apartment operations of 1-
4 apartments are not included.
In terms of geographic coverage the comparisons have included hotels in each city (defined
as city centre and edge of city centre) and on the outskirts of each city. For the purposes of
the comparisons hotels in surrounding rural areas have been excluded, although it is
recognised that in some cases such hotels may be part of the overall competitive hotel
supply for each city.
The comparisons are based on desk research as follows:
Interrogation of online hotel booking sites to identify existing hotels;
Internet searches for information on hotel development projects;
Email consultations with Tourism, Economic Development and Planning Officers in
each city.
Key observations on the comparisons are set out in the following pages.
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a) Current Hotel Supply
Total Hotel Supply
In terms of total hotel supply Bath has the lowest number of hotel bedrooms of any of
the comparator cities.
York has the most significant hotel supply - almost double the number of hotel
bedrooms that Bath has.
Oxford, Cambridge and Chester have similar numbers of hotel bedrooms - 300-600
more than Bath.
Exeter has a similar number of hotel bedrooms to Bath.
Standard of Hotels
Bath has the most upmarket hotel supply in terms of 5 star and boutique hotel
provision and 5 star guest houses, and more limited supplies of 3 star, 2 star and
budget hotels.
Bath has four 5 star hotels compared to only one in Oxford, York and Chester and
none in Cambridge and Exeter.
Bath has a similar number of boutique hotel bedrooms to Oxford and York but more
than double the boutique hotel supplies of Cambridge, Chester and Exeter.
Boutique hotels in all six cities are predominantly independent hotels. Boutique hotel
brands represented in the cities are as follows:
o MGallery - Bath
o Malmaison - Oxford
o Hotel du Vin - Cambridge and York
o Hotel Indigo - York
o Abode - Chester and Exeter
o Chapter - Exeter
Bath has the lowest number of 4 star hotel bedrooms. Cambridge, York and Chester
have more than double the number of 4 star hotel bedrooms that Bath has.
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Bath has by far the lowest stock of 3 star and 2 star/lower grade hotel bedrooms.
Bath has a significant stock of 5 star and boutique guest houses. This type of
accommodation has not so far developed to any extent in the other cities: Oxford,
York and Chester each have only one 5 star guest house, while Cambridge and
Exeter have none.
Exeter and York have two upper-tier budget hotels - a Holiday Inn Express and a
Hampton by Hilton in each case. Bath, Cambridge, Chester and Oxford each have a
Holiday Inn Express.
Bath has the lowest number of budget hotel bedrooms. York and Cambridge have
double the number of budget hotel bedrooms that Bath has.
Serviced apartments and aparthotels comprise a relatively small element of the hotel
supplies of the six cities. Oxford, Cambridge, York and Chester have more serviced
apartments than Bath. Only Exeter has a smaller supply of this type of
accommodation.
b) Hotel Development 2009-2015
Hotel development trends have been similar across all six comparator cities between
2009 and 2015: there has been a general move upmarket, with the upgrading and
repositioning of 3 star hotels as 4 star and boutique hotels, the opening of new 5 star
and boutique hotels in some cities, and some loss of poorer quality 2 star/ lower grade
hotel stock; new Premier Inn and/or Travelodge budget hotels have opened in most
of the cities (other than Oxford); and the supply of serviced apartments and
aparthotels has gradually increased.
Bath and York are the only cities that have seen 5 star hotel development.
Bath has seen the most significant increase in boutique hotel provision. This has been
through the repositioning of existing 2 and 3 star hotels. No entirely new boutique
hotels have opened in Bath. All of the other five cities have seen the opening of new
boutique hotels, including a branded Hotel Indigo in York and an Abode branded
boutique hotel in Chester. In Exeter the former Barcelona boutique hotel has been
rebranded under the Chapter Hotels boutique hotel brand.
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None of the six cities have seen the opening of new 4 star hotels in the last 6 years.
Two 4 star hotels in Chester have extended.
In terms of upper-tier budget hotel openings, Hampton by Hilton hotels have opened
in York and Exeter. In York the Ramada Encore has been repositioned as a
Travelodge, resulting in only a marginal net change in the city's upper-tier budget
hotel supply.
All of the cities apart from Oxford have seen an increase in budget hotel provision.
Cambridge has seen a significant increase in its budget hotel supply, with the opening
of two Premier Inn and two Travelodge hotels since 2009. Exeter has seen the opening
of two Premier Inns (with a third due to open in October 2015), while York has seen the
opening of a new Premier Inn and the repositioning of the Ramada Encore to a
Travelodge. Chester has seen the opening of a new Premier Inn but the closure of the
former Comfort Inn. A Travelodge also opened in Chester in 2010 but was
subsequently sold in 2013 for conversion to student accommodation. Bath has seen
the opening of a Premier Inn.
Bath, York and Chester have each seen the closure of a 2 star hotel.
All of the six cities have seen a gradual increase in serviced apartment/ aparthotel
provision. Cambridge, York and Chester have seen more significant rises in their
supplies of these types of accommodation. Bath, Oxford and Exeter have seen only a
marginal growth in such provision.
c) Planned Hotel Development
All of the comparator cities look set to see more hotel development than Bath going
forward (if all of the current hotel proposals are progressed).
York and Cambridge are set to see an increase in 5 star hotel provision, with the
planned expansion of The Grand in York and the current upgrading of the University
Arms in Cambridge as a landmark hotel for the city.
Bath is the only city with a new 4 star hotel currently under construction, however
proposals for new 4 star hotels are also being progressed in Cambridge and Oxford,
and look likely to come forward in Exeter and possibly York. In Chester there are plans
for a new 4 star hotel as a replacement for the existing Crowne Plaza.
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There are plans for Hotel Indigo boutique hotels in Bath and Oxford and proposals for
new small independent boutique hotels in Bath, Oxford and Cambridge.
Bath and York are the only cities that are set to see the opening of budget boutique
hotels, with the Z Hotel being progressed in Bath and plans announced for a Moxy
hotel in York.
At the 3 star level schemes could come forward in Cambridge, Chester and Exeter.
A second Travelodge is currently under construction in Oxford, while a fourth Premier
Inn will open in Exeter in October 2015. There are plans for Ibis budget hotels in
Cambridge and Chester. Bath, York, Chester and Oxford are all target locations for
further Premier Inn hotels, while Travelodge has Exeter, York and Bath as targets for
additional hotels.
A 133-apartment aparthotel has been approved in Cambridge and there are plans
for a 200-apartment aparthotel in York. Roomzzz also has plans to open an aparthotel
in York.
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APPENDIX 3a
HOTEL LISTINGS FOR EACH COMPARATOR CITIES
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BATH – CURRENT HOTEL SUPPLY – JULY 2015
Hotel Standard No
Rooms
Brand
City
Royal Crescent
Macdonald Bath Spa
5 star
5 star
45
129
Relais & Chateaux
Macdonald
Bath Priory 5 star 33 Brownsword Hotels
Gainsborough Bath Spa 5 star 99 Leading Hotels of the World
Hilton Bath City
Francis
4 star
Boutique
173
98
Hilton
MGallery
The Halcyon
The Queensbury
Boutique
Boutique
21
29
Abbey Boutique 60
Harington’s Boutique 13
Lansdowne Grove 3 star 54 Shearings
Pratt’s 3 star 46 Atlas Hotels
The Royal 3 star 35
The County 3 star 22 Seasons Holidays
Redcar Lower Grade 41
Parade Park Lower Grade 38
Paradise House 5 star GA 11
Dorian House
One Nine Three
5 star GA Boutique
5 star GA Boutique
13
10
Tasburgh House 5 star GA 12
The Ayrlington 5 star GA 16
The Windsor 5 star GA 15
Villa Magdala 5 star GA 20
Dukes Boutique B&B 17
Grays Boutique B&B 12
Brindleys Boutique B&B 6
Holiday Inn Express Bath Upper-tier Budget 126 Holiday Inn Express
Premier Inn Bath City Budget 108 Premier Inn
Travelodge Bath Waterside Budget 125 Travelodge
Travelodge Bath Central Budget 66 Travelodge
SACO Bath Serviced Aprtments 43 SACO
Halcyon Apartments Serviced Aprtments 8
City Outskirts
Combe Grove Manor 4 star 42 The Hotel Collection
Bailbrook House, Batheaston 4 star 94 Hand Picked Hotels
The Old Mill, Batheaston 3 star 35
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CAMBRIDGE – CURRENT HOTEL SUPPLY – JULY 2015
Hotel Standard No
Rooms
Brand
City
Cambridge City Hotel 4 star 198
University Arms 4 star 120
Doubletree by Hilton 4 star 122 Doubletree by Hilton
Best Western Plus Gonville 4 star 84 Best Western
Hotel du Vin Boutique 41 Hotel du Vin
The Varsity Boutique 48
Arundel House 3 star 102
Lensfield 3 star 30
Regent 3 star 22
Royal Cambridge 3 star 57 Atlas Hotels
Ashley 2 star 16
Centennial
Fenners
2 star
Lower Grade
39
22
Helen Lower Grade 20
Sorrento Lower Grade 22
Travelodge Cambridge Central Budget 120 Travelodge
Travelodge Newmarket Road Budget 219 Travelodge
Premier Inn Cambridge City East Budget 120 Premier Inn
City Stay Apartments
Nobleo Apartments
Your Space Apartments
Apple Apartments
Signet Apartments
Serviced Apts
Serviced Apts
Serviced Apts
Serviced Apts
Serviced Apts
32
8
65
14
9
City Outskirts
Menzies Cambridge
Hotel Felix
4 star
Boutique
136
52
Menzies
Best Western Plus Cambridge Quy Mill 4 star 50 Best Western
Holiday Inn Cambridge 3 star 161 Holiday Inn
Holiday Inn Express Cambridge
Lovell Lodge
Premier Inn Cambridge A14 J32
Premier Inn Cambridge North
Travelodge Cambridge Orchard Park
Upper-tier Budget
Lower Grade
Budget
Budget
Budget
100
35
154
20
138
Holiday Inn Express
Premier Inn
Premier Inn
Travelodge
Notes:
1. Currently closed for refurbishment
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CHESTER – CURRENT HOTEL SUPPLY – JULY 2015
Hotel Standard No
Rooms
Brand
City
The Chester Grosvenor 5 star 80
Crowne Plaza Chester 4 star 160 Crowne Plaza
Best Western Premier Queen 4 star 218 Best Western
Macdonald New Blossoms
ABode Chester
4 star
Boutique
67
84
Macdonald
ABode
Oddfellows Chester Boutique 18
Mill 3 star 129
Best Western Westminster 3 star 75 Best Western
The D 3 star 29
Alton Lodge 3 star 21
Lloyd’s of Chester 3 star 17
Belgrave 2 star 34
Brookside 2 star 27
Dene 2 star 53
Eaton 2 star 16
Hotel Roma 2 star 28
Stafford
Bawn Lodge
Chester Court
2 star
Lower Grade
Lower Grade
25
15
20
Stone Villa 5 star GA 10
Holiday Inn Express Chester Racecourse Upper-tier Budget 97 Holiday Inn Express
Premier Inn Chester City Centre
Premier Inn Chester Central North
Budget
Budget
120
31
Premier Inn
Premier Inn
Travelodge Chester Central Budget 60 Travelodge
Roomzzz Chester City Aparthotel 64 Roomzzz
Chester Apartments Serviced Apts 6
Base Serviced Apartments Serviced Apts 7
City Outskirts
Crabwall Manor
Doubletree by Hilton Chester
Mercure Chester Abbots Well
Mollington Banastre
4 star
4 star
4 star
4 star
48
140
126
63
Doubletree by Hilton
Mercure
Holiday Inn Chester South 3 star 145 Holiday Inn
Innkeeper’s Lodge Chester South East
Premier Inn Chester Central South East
Travelodge Chester Warrington Road
Budget
Budget
Budget
14
94
35
Innkeeper’s Lodge
Premier Inn
Travelodge
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YORK – CURRENT HOTEL SUPPLY – JULY 2015
Hotel Standard No
Rooms
Brand
City
The Grand Hotel & Spa
Hilton
5 star
4 star
107
130
Hilton
York Marriott 4 star 151 Marriott
Royal York 4 star 167 Principal Haley
The Grange 4 star 36
Best Western Plus Dean Court
Novotel York Centre
4 star
4 star
37
124
Best Western
Novotel
Hotel Indigo York Boutique 101 Hotel Indigo
Grays Court
Hotel Du Vin York
Marmadukes Town House Hotel
Boutique
Boutique
Boutique
7
44
20
Hotel Du Vin
Judges Court Boutique 15
The Churchill 3 star 32
Park Inn by Radisson York 3 star 200 Park Inn
Holiday Inn 3 star 142 Holiday Inn
Best Western Kilima 3 star 26 Best Western
Minster 3 star 35
Best Western Monkbar 3 star 125 Best Western
Mount Royale 3 star 24
Hotel 53 3 star 100
Elmbank
Hedley House
3 star
3 star
72
26
Middletons 3 star 54
Alhambra Court 2 star 24
Holgate Hill
Hotel Noir
Newington
Lower Grade
Lower Grade
2 star
18
28
44
The Queens 2 star 78
Wheatlands Lodge Lower Grade 60
Beechwood Close Lower Grade 14
Blue Bridge Lower Grade 18
Jorvik Hotel Lower Grade 22
Heworth Court Lower Grade 11
Galtres Lodge Lower Grade 13
St Denys Lower Grade 11
Bishops 5 star GA 10
Judge's Lodging 5 star Inn 21
Lamb & Lion Inn 4 star Inn 12
Guy Fawkes Inn 4 star Inn 13
Hampton by Hilton York Upper-Tier Budget 119
Ibis York Centre
Premier Inn Blossom Street North
Premier Inn Blossom Street South
Travelodge York Central
Travelodge York Micklegate
Budget
Budget
Budget
Budget
Budget
85
102
91
93
104
Ibis
Premier Inn
Premier Inn
Travelodge
Travelodge
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The Lawrance Luxury Aparthotel Aparthotel 15
City Lets Serviced Apts 35
City Apartments York Serviced Apts 6
Goodramgate Apartments Serviced Apts 9
Clearly Apartments Serviced Apts 8
The Blue Rooms @ The Blue Bicycle Serviced Apts 6
City Outskirts
Middlethorpe Hall
Mercure York Fairfield Manor
4 star
4 star
29
89
Relais & Chateaux
Mercure
Best Western York Pavilion
Holiday Inn Express York
3 star
Upper Tier Budget
57
49
Best Western
Holiday Inn Express
Premier Inn York North Budget 49 Premier Inn
Premier Inn York North West
Travelodge York Hull Road
Budget
Budget
64
40
Premier Inn
Travelodge
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OXFORD – CURRENT HOTEL SUPPLY – JULY 2015
Hotel Standard No
Rooms
Brand
City
Macdonald Randolph 5 star 151 Macdonald
Oxford Spires Four Pillars 4 star 174 Four Pillars
Cotswold Lodge 4 star 49
Old Parsonage Boutique 35
Old Bank Boutique 42
Ethos
Malmaison
The Bocardo
Boutique
Boutique
Boutique
16
94
10
Malmaison
Vanbrugh House Boutique 22
Mercure Eastgate 3 star 63 Mercure
Royal Oxford 3 star 26
Best Western Linton Lodge 3 star 87 Best Western
Balkan Lodge Lower Grade 13
Bath Place Lower Grade 20
River Lower Grade 20
Tree Lower Grade 9
Victoria Lower Grade 22
Victoria House Hotel Lower Grade 14
Remont 4 star GA 25
Galaxie 4 star GA 32
Burlington House 5 star GA 11
Head of the River Boutique Inn 12
Noa Residence Svcd Apts 12
Oxford Short Lets Svcd Apts 80
320 Banbury Road Apartments Svcd Apts 7
City Outskirts
The Oxford
Oxford Thames Four Pillars
Hawkwell House
Holiday Inn Oxford
4 star
4 star
3 star
3 star
168
84
66
154
The Hotel Collection
Four Pillars
Bespoke
Holiday Inn
Westwood
Holiday Inn Express Kassam Stadium
Premier Inn Oxford
Travelodge Oxford Peartree
3 star
Upper-Tier Budget
Budget
Budget
20
162
143
197
Holiday Inn Express
Premier Inn
Travelodge
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EXETER – CURRENT HOTEL SUPPLY – JULY 2015
Hotel Standard No
Rooms
Brand
City
Clarion Buckerell Lodge 4 star 54 Clarion Collection
Mercure Southgate 4 star 154 Mercure
The Rougemont 4 star 98 The Hotel Collection
ABode Boutique 53 Abode
Magdalen Chapter Boutique 59 Chapter Hotels
Southernay House Boutique 10
City Gate 3 star 14 Youngs
Gipsy Hill 3 star 37
Jury’s Inn Exeter 3 star 170 Jury’s Inn
Queen’s Court 3 star 18
St Olaves 3 star 15
White Hart 3 star 55 Marstons
Great Western Lower Grade 33
Clock Tower Lower Grade 18
St Andrews Lower Grade 19
Cedar Lodge 2 star 26
Premier Inn Exeter Central St Davids Budget 102 Premier Inn
Silver Springs Aparthotel 8
Southlands Aparthotel 10
City Outskirts
Woodbury Park 4 star 59
Barton Cross 3 star 9
Exeter Court, Kennford 3 star 63
Best Western Lord Haldon 3 star 23
The Devon 3 star 40 Brend Hotels
Gissons, Kennford 2 star 21
Globe, Topsham Boutique Inn 19 St Austell Brewery
Holiday Inn Express Exeter M5 J29 Upper-Tier Budget 122 Holiday Inn Express
Hampton by Hilton Exeter Airport Upper-Tier Budget 120 Hampton by Hilton
Premier Inn Exeter (Countess Wear) Budget 44 Premier Inn
Premier Inn Exeter (M5 J29) Budget 102 Premier Inn
Travelodge Exeter M5 Budget 102 Travelodge
Exeter Toby Lodge Budget 39 Toby
Innkeeper’s Lodge Exeter East Budget 21 Innkeeper’s Lodge
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APPENDIX 3b
HOTEL STOCK COMPARISONS BY STANDARD
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Standard Bath Oxford Cambridge York Chester Exeter Estabs Rooms Estabs Rooms Estabs Rooms Estabs Rooms Estabs Rooms Estabs Rooms
City 5 star 4 306 1 151 1 107 1 80
4 star 1 173 2 223 4 524 6 645 3 445 3 302
Boutique 5 221 6 219 2 89 5 187 2 102 3 122
3 star 4 157 3 176 4 212 11 810 5 271 6 309
2 star/Lower Grade 2 79 8 155 5 119 12 367 8 218 4 96
5 star GA/Boutique B&B 10 132 1 11 1 10 1 10
4/5 star/Boutique Inn 1 12 3 46
Upper-Tier Budget 1 126 1 119 1 97
Budget 3 299 3 459 5 475 3 211 1 102
Serviced Apartments 2 51 3 99 5 128 6 79 3 77 2 18
Total City 32 1544 25 1046 23 1531 51 2845 27 1511 19 949
City Outskirts 5 star
4 star 2 136 2 252 2 186 2 118 4 377 1 59
Boutique 1 52
3 star 1 35 3 240 1 161 1 57 1 145 4 135
2 star/Lower Grade 1 35 1 21
4/5 star/Boutique Inn 1 19
Upper-Tier Budget 1 162 1 100 1 49 2 242
Budget 2 340 3 312 3 153 3 143 5 308
Serviced Apartments
Total City Outskirts 3 171 8 994 9 846 7 377 8 665 14 784
5 star 4 306 1 151 1 107 1 80
4 star 3 309 4 475 6 710 8 763 7 822 4 361
Boutique 5 221 6 219 3 141 5 187 2 102 3 122
3 star 5 192 6 416 5 373 12 893 6 416 10 444
2 star/Lower Grade 2 79 8 155 6 154 12 341 8 218 5 117
5 star GA/Boutique B&B 10 132 1 11 1 10 1 10
4/5 star/Boutique Inn 1 12 3 46 1 19
Upper-Tier Budget 1 126 1 162 1 100 2 168 1 97 2 242
Budget 3 299 2 340 6 771 8 628 6 354 6 410
Serviced Apartments 2 51 3 99 5 128 6 79 3 77 2 18
TOTAL 35 1715 33 2040 32 2377 58 3222 35 2176
33 1733
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APPENDIX 3c
CHANGES IN HOTEL SUPPLY 2009-2015
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APPENDIX 3c
CHANGES IN HOTEL SUPPLY 2009-2015
BATH
New Hotels
Hotel Standard Rooms Year Opened Gainsborough Bath Spa 5 star 99 2015
Halcyon Apartments Serviced Apts 8 2014
Premier Inn Bath City Centre Budget 108 2013
Hotel Extensions
Hotel Standard Additional
Rooms
Year Opened
Bailbrook House 4 star 13 2013
Hilton Bath City 4 star 23 2013
Rebranding, Repositioning and Refurbishment of Hotels The 5 star Royal Crescent underwent a £5m refurbishment in 2013 and 2014 under its new
owners Topland Group plc to restore it to one of the UK's leading luxury hotels
The 5 star Macdonald Bath Spa is currently refurbishing 2019 bedrooms in 2015
Bailbrook House underwent a £10m refurbishment in 2013 following its acquisition by Hand
Picked Hotels to reposition as a 4 star hotel
The Francis was repositioned as an MGallery boutique hotel in 2012, following a £6 million
refurbishment.
The Abbey Hotel was acquired by new owners in February 2012, who have gradually
repositioned it as a midmarket boutique hotel.
The 2 star George’s Hotel was redeveloped as The Halcyon boutique hotel in 2010 following a
£3m makeover
The 3 star Dukes Hotel has been repositioned as the Dukes boutique guest house
The Holiday Inn Express will be upgraded to the new generation Holiday Inn Express bedroom
product in 2014
The Travelodge Bath Waterside and Travelodge Bath Central have both been upgraded to
the new Travelodge bedroom product
Hotel Closures No hotels have closed in Bath over the last 6 years.
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CAMBRIDGE
New Hotels
Hotel Standard Rooms Year Opened Premier Inn Cambridge City East Budget 120 2014
Apple Apartments Serviced Apts 14 2013
Signet Apartments Serviced Apts 9 2013
Travelodge Newmarket Road Budget 219 2013
Travelodge Orchard Park Budget 138 2011
The Varsity Boutique 48 2010
Nobleo Apartments Serviced Apts 8 2009
Premier Inn Cambridge A14 J32 Budget 154 2009
Hotel Extensions
Hotel Standard Additional
Rooms
Additional Facilities
No major hotel extensions 2009-2015
Rebranding, Repositioning and Refurbishment of Hotels The 4 star Crowne Plaza was acquired by London & Regional in August 2012 and has been
renamed as the Cambridge City Hotel. A full refurbishment of the hotel was completed in
February 2015
The University Arms was sold in 2012 by the De Vere Group to Melford Capital Partners. It
closed in September 2014 for a major refurbishment, upgrading and expansion programme
that will see it repositioned as a landmark (possibly 5 star) hotel with 73 additional bedrooms
and a new restaurant and bar
The Gonville upgraded to a 4 star hotel (from 3 stars) in 2012
The Cambridge Quy Mill has upgraded to 4 stars
Hotel Closures The lower grade Hamilton Lodge closed in 2014, with the loss of 32 bedrooms
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CHESTER
New Hotels
Hotel Standard Rooms Year Opened
Roomzzz Chester City Aparthotel 64 2015
Chester Apartments Serviced Apts 6 2013
Base Serviced Apartments Serviced Apts 7 2013
Oddfellows Chester Boutique 18 2011
ABode Chester Boutique 85 2010
Premier Inn Chester City Centre Budget 120 2009
Hotel Extensions
Hotel Standard Additional
Rooms
Year Opened
Queen 4 star 87 2009
Doubletree by Hilton 4 star 43 2009
Rebranding, Repositioning and Refurbishment of Hotels The Ramada Chester was rebranded as the Mercure Chester Abbots Well in 2011
The Innkeeper’s Lodge Chester North East was rebranded as the Travelodge Chester
Warrington Road in 2009
Hotel Closures The 160-bedroom Travelodge Chester Centre Delamere Street opened in 2010 and was then
sold in 2013 for conversion to student accommodation
The Green Bough boutique hotel (15 bedrooms) was sold in 2014 for conversion to a
retirement home
The 2 star Curzon Hotel has closed (16 bedrooms)
The Comfort Inn lower grade budget hotel (31 bedrooms) closed in 2014
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YORK
New Hotels
Hotel Standard Rooms Year Opened Judges Court Boutique 15 2015
Hotel Indigo York Boutique 101 2015
The Lawrence Luxury Aparthotel Aparthotel 15 2014
The Blue Rooms @ The Blue Bicycle Serviced Apts 6 2014
City Apartments York Serviced Apts 6 2013
Goodramgate Apartments Serviced Apts 9 2013
Clearly Apartments Serviced Apts 8 2013
Hampton by Hilton York Upper-Tier
Budget
119 2012
Grays Court Boutique 7 2011
Cedar Court Grand 5 star 107 2010
Premier Inn Blossom Street South Budget 91 2010
Hotel Extensions
Hotel Standard Additional
Rooms
Year Opened
Best Western Monkbar 3 star 24 2014
Rebranding, Repositioning and Refurbishment of Hotels The Novotel has upgraded to 4 stars
Ramada Encore rebranded as the Travelodge York Central Mickelgate in 2010
Hotel Closures The 2 star Knavesmire (20 bedrooms) has closed for conversion back into a private residence
OXFORD
New Hotels
Hotel Standard Rooms Year Opened Vanbrugh House Boutique 22 2013
320 Banbury Road Apartments Serviced Apts 7 2013
The Bocardo Boutique 10 2012
Noa Residence Serviced Apts 12 2012
Hotel Extensions
Hotel Standard Additional
Rooms
Year Opened
Oxford Spires Four Pillars 4 star 14 2013
Oxford Thames Four Pillars 4 star 22 2014
Rebranding, Repositioning and Refurbishment of Hotels The Old Parsonage has been repositioned as a boutique hotel
The Oxford has been taken over by The Hotel Collection - previously Puma Hotels
Hotel Closures No hotels have closed in Oxford over the last 6 years.
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EXETER
New Hotels
Hotel Standard Rooms Year Opened Silver Springs Aparthotel 8 2013
Southlands Aparthotel 10 2013
Premier Inn Exeter M4 J29 Budget 102 2013
Hampton by Hilton Exeter
Airport
Upper-Tier
Budget
122 2013
Premier Inn Exeter St Davids Budget 102 2011
Southernay House Hotel Boutique 10 2011
Hotel Standard Additional
Rooms
Additional Facilities
No major hotel extensions 2009-2015
Rebranding, Repositioning and Refurbishment of Hotels The boutique Hotel Barcelona reopened as The Magdalen Chapter boutique hotel in 2012
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APPENDIX 3d
HOTEL GROWTH 2009-2015
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APPENDIX 3d
CHESTER HOTEL STOCK COMPARISONS – HOTEL GROWTH 2009-2015 – HERITAGE DESTINATIONS
Standard Bath Oxford Cambridge York Chester Exeter Net
New
Hotels
Net
New
Rooms
%
Growth
(Rooms)
Net
New
Hotels
Net
New
Rooms
%
Growth
(Rooms)
Net
New
Hotels
Net
New
Rooms
%
Growth
(Rooms)
Net
New
Hotels
Net
New
Rooms
%
Growth
(Rooms)
Net
New
Hotels
Net
New
Rooms
%
Growth
(Rooms)
Net
New
Hotels
Net
New
Rooms
%
Growth
(Rooms
5 star 1 99 47.8 1 107 *
4 star 1 117 60.9 (1) 1 0.2 2 134 23.3 1 124 19.4 130 18.8
3 star (4) (256) (57.1) (2) (134) (26.4) (1) (100) (10.3)
Boutique 3 179 426.2 3 67 44.1 1 48 51.6 3 123 192.2 1 88 628.6 1 10 8.9
Upper-tier
Budget
15 9.8 1 122 101.7
Budget 1 108 56.5 4 631 450.7 2 239 61.4 89 33.6 2 204 99.0
2 star (1) (21) (21.0) (1) (20) (5.5) (1) (16) (6.8)
5 star Guest
Houses
1 17 14.8
Serviced
Aprtmnts
1 8 18.6 2 19 23.8 3 31 32.0 5 44 125.7 3 77 * 2 18 *
Total 3 251 17.1 4 87 4.5 8 710 42.6 10 532 20.0 3 368 20.4 6 354 25.7
Notes:
* No hotels of this standard existed in the city before 2009
Figures in brackets ( ) show a decrease in supply
Figures for new hotels and new rooms are net figures taking account of new hotel openings and rebrandings/ upgradings
Growth rates are calculated on the basis of the total hotel supply for each city (in city centre/edge of city centre and city outskirts locations)
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APPENDIX 3e
PLANNED HOTEL DEVELOPMENT
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APPENDIX 3d
PLANNED HOTEL DEVELOPMENT – AS AT JULY 2015
LOCATION/SITE PLANNED
HOTEL/S
STANDARD ROOMS STATUS
Bath Kingsmead House
James Street West
Apex 4 star 177 Under construction.
Due to open early
2017
Saw Close Z Hotel Budget
Boutique
148 Under construction.
Due to open 2016
South Parade Hotel Indigo Boutique 121
(54 new
rooms)
Proposed
redevelopment of
the Pratt's and
Halcyon hotels and
adjacent properties
Great Pulteney
Street
Carfax Hotel Luxury
Boutique
40 Proposed
redevelopment and
expansion of the
former temperance
hotel. Currently on
hold following
objections from
local residents
Broad Street Former King
Edwards School
Boutique 12 Planning permission
granted in 2010 and
renewed in 2013
Queen Square Francis Hotel Boutique 21 Planning permission
granted in 2012
Total Planned New Hotel Rooms - Bath 452
Additional Information
Premier Inn is looking for sites for a further two hotels in Bath
Travelodge is looking for a site for another hotel in Bath
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LOCATION/SITE PLANNED
HOTEL/S
STANDARD NEW
ROOMS
STATUS
Cambridge Regent Street University Arms 5 star 71 Under construction. A major
redevelopment and expansion of this
hotel is currently underway to deliver a
landmark (possible 5 star) hotel with
an additional 71 bedrooms, a new
destination restaurant, conference
facilities and a gym
CB1
Cambridge Station
Ibis Budget 231 Under construction. Hotel being
progressed as part of the CB1 city
quarter mixed-use office, apartment,
retail, leisure and transport
interchange development
Red House
Station Road
O'Callaghan
Hotel
4 star 169 Planning permission granted October
2013 for a hotel with bar, restaurant,
meeting rooms and gym
Milton Road Proposed hotel Aparthotel 133 Plans for this aparthotel were
approved at appeal in June 2015
The Forum
Addenbrookes
Crowne Plaza 4 star 198 Under construction. Hotel being
progressed as part of The Forum
development at Addenbrookes and
the new Cambridge Biomedical
Campus. Other elements of the
scheme include a private hospital,
900-seat conference centre and
postgraduate medical education
centre
North West
Cambridge
Proposed hotel 3 star 130 Hotel included as part of the North
West Cambridge university and
research quarter
Gonville Place Gonville Hotel 4 star 31 Planning permission granted for
extensions to provide an additional 31
bedrooms and a gym and spa facility
Coldhams Business
Park
Holiday Inn
Express
Upper-Tier
Budget
67 Proposed hotel extension. Planning
permission currently pending
Chesterton Road Ashley Hotel Boutique 19 Planning permission granted for an
additional 19 bedrooms and
underground car parking. It is
understood that the owners are
planning to progress the extension as
part of a scheme to reposition the
entire hotel as ca 35-bedroom
boutique hotel
Total Planned New Hotel Rooms – Cambridge 1049
Additional Information
Premier Inn is looking for sites for a further two hotels in Cambridge
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LOCATION/SITE PLANNED
HOTEL/S
STANDARD ROOMS STATUS
Chester Lower Bridge Street Oddfellows Serviced Apts 5 Under construction.
Oddfellows boutique hotel is
currently in the process of
opening 5 serviced
apartments alongside the
hotel.
Boughton Retail Centre n/a 3/4 star 120 Waitrose received planning
permission in 2012 for a new
supermarket, hotel and bars
and restaurants on the site of
the former Boughton Retail
Centre as part of Chester’s
new Business Quarter. The
supermarket opened in
November 2014. Work has
not so far commenced on
the hotel, bars and
restaurants.
Northgate
development
Crowne Plaza 4 star 168 New hotel planned as a
replacement for the existing
Crowne Plaza
Broughton Shopping
Park
n/a Budget 80 Planning granted at appeal
in January 2015 for a hotel,
pub/restaurant and four food
units on land adjacent to
Broughton Shopping Park to
the west of Chester
Grosvenor Park Road Ibis Budget 87 Planning permission renewed
in May 2014 - first granted
Jan 2008
Hoole Doubletree by
Hilton Chester
4 star 85 Planning permission granted
in October 2013 for an
additional 85 bedrooms,
expanded restaurant and
new meeting/function rooms
Chester Zoo n/a 150 Hotel included as part of the
planned expansion of
Chester Zoo
Total Planned New Hotel Rooms - Chester 527
Additional Information
Premier Inn is looking for a site for another hotel in Chester.
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LOCATION/SITE PLANNED
HOTEL/S
STANDARD ROOMS STATUS
York Station Rise,
York City Centre
Grand Hotel
& Spa
5 star 107 Splendid Hospitality is
planning a £15m expansion
of the Grand Hotel & Spa. It
has acquired the adjacent
Roman House office building
and has submitted plans to
double the hotel's size with
an additional 107 bedrooms.
The Chocolate Works,
former Terry’s Chocolate
Factory
n/a n/a n/a Henry Boot Developments
acquired the site in April
2013. Its plans for the site
include a hotel alongside
residential apartments,
offices and leisure uses.
Barbican Centre n/a Aparthotel
200
Hotel proposed as part of
the redevelopment of the
Barbican Centre site by
Broadhall.
Layerthorpe
City centre
n/a 124 Hotel proposed by Tiger
Developments.
York Central n/a n/a n/a The new, emerging plans for
the £1bn York Central
scheme include hotels
alongside 1,000 homes,
250,000 sq ft of offices and
shops.
Total Planned New Hotel Rooms – York 6461
Notes:
1. Allowing for 100 bedrooms at The Chocolate Works and 150 bedrooms at York
Central
Additional Information
Roomzzz is planning to open an aparthotel in York
York is a target for Premier Inn (for another two hotels) and Travelodge
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LOCATION/SITE PLANNED
HOTEL/S
STANDARD ROOMS STATUS
Oxford Abingdon Road Travelodge Budget 83 Under construction: due to open early 2016.
Cowley Premier Inn
Oxford
Budget 63 Planning permission approved in May 2015
for 63-bedroom extension.
Cooper Callas
Building,
Paradise Street
Hotel Indigo Boutique 150 Dominvs Hospitality acquired the site in
October 2014 with a view to bringing it
forward for hotel development. A planning
application is expected in September or
October 2015
15-19 George Street n/a Boutique 43 Proposed conversion of empty offices to a
boutique hotel. Planning permission
approved April 2012.
Tyndale House,
Cowley Road
n/a Budget 66 Planning permission granted in February
2013 for the conversion of this former office
building into a hotel. Travelodge were at
one time reportedly in discussions about the
hotel.
Iffley Hawkwell
House
3 star 11 Proposed conversion of a laundry and
conference room to hotel bedrooms.
Planning permission granted February 2013
Sandford Oxford Thames
Four Pillars
4 star 20 Planning permission for a further 20
bedrooms
Oxpens, West End n/a 4 star 155 Hotel included in the plans for the
regeneration of the Oxpens site, alongside
400 homes and 10,400 sq m of office space.
A development agreement between
Oxford City Council and developer
Exemplar was signed in April 2015. Once
planning permission has been secured, work
on the scheme could commence at the
end of 2017.
Barton Park n/a n/a 120 Plans for the new Barton Park urban
extension to the north of Oxford include a
hotel alongside 885 new homes and
community facilities.
Northern Gateway n/a n/a 180 The adopted Area Action Plan for the
Northern Gateway employment
development area to the north of the city
makes provision for a 180-bedroom hotel.
Oxford Station n/a n/a 100 The Master Plan for the redevelopment of
Oxford Station and the area around it
includes the potential for a new 4-storey
hotel.
Total Planned New Hotel Rooms - Oxford 991
Additional Information
Premier Inn is looking for sites for a further 3 hotels in Oxford.
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LOCATION/SITE PLANNED
HOTEL/S
STANDARD ROOMS STATUS
Exeter Southernay
Gardens
Premier Inn Budget 120 Under construction.
Due to open October
2015
Exeter Science
Park
n/a 4 star 150 The Science Park
developers are in
discussions with a
number of hotel
operators for the hotel
site on the Science
Park
Exeter Skypark n/a n/a 100 A hotel is proposed as
part of the Exeter
Skypark business park
development
Sandy Park n/a n/a 120 The Sandy Park rugby
stadium and
conference centre is
at the early stages of
looking at building a
hotel to enhance its
conferencing offer.
The Exeter
Development Plan
makes specific
provision for a hotel of
up to 120 bedrooms at
Sandy Park
Total Planned New Hotel Rooms – Exeter 490
Additional Information
Exeter is a target for Travelodge for a second hotel.
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APPENDIX 4
BATH HOTEL DEVELOPER TESTING – SAMPLING & RESPONSE
HOTEL COMPANY/ BRAND
RESPONSE INTEREST
Accor Y Y
Apex Y *
Astu Y N
Bespoke Y Y
Beyonder Y Y
Bridge Street Y Y
Cycas N
Hilton Y Y
Hotel du Vin/Malmaison Y Y
Hyatt N
IHG Y Y
Louvre Y Y
Marriott Y Y
Moxy Y Y
Nadler Hotels Y Y
Premier Apartments Y N
Premier Inn Y Y
Rezidor Y Y
Roomzzz N
Sleeperz Y Y
Somerston N
Starwood Y Y
Travelodge Y Y
Village Y Y
Wyndham Y Y
Z Hotels Y *
* Committed scheme