Its London Hotels are a leading contributor to this growth. RevPAR in London grew by 7.0% to £82.96 (2011: £77.52). This increase was driven by a 2.8% increase in rate to £107.88 (2011: £104.95) and an increase in occupancy of 3 percentage points to 76.9% (2011: 73.9%). RevPAR increases were experienced in all hotels with the exception of Knightsbridge, which is in the process of a shift into a higher yielding market segment.
Outside London, the UK remains a challenge with RevPAR falling by 3.3% to £37.16 (2011: £38.42). This was despite strong double digit RevPAR growth in Manchester and Aberdeen. Most hotels saw a reduction in RevPAR, particularly the two Gatwick hotels and Newcastle. Average rate fell by 1.9% to £58.67 (2011: £59.83) and occupancy decreased by 0.9 percentage points to 63.3% (2011: 64.2%).
Of its 110 hotels, MC own or lease 65, have 23 on management contract, and franchise 11, and jointly invest in a further 11. It is growing principally by adding hotels under management contract, of which it has 28 in the pipeline. As a result of this structure the firm is carrying relatively little debt, which has continued to fall and is now down to £31 million, so that 87% of the assets are unencumbered.
Shares in M&C closed last night at 489.7p which values the firm at £1.56 billion.