According to PcW's UK hotels forecast, the firm thinks the current pace of hotel performance growth is not sustainable through the second half of the year and into 2018.

The boost from the weak pound is likely to continue but PcW expects growth will be weaker. So far trading has been very good but, after 4 months of double digit or close to double digit RevPAR growth, June and July have seen marginal occupancy declines and more moderate RevPAR growth.

Some London hotels recently reported weaker weekend domestic demand and some luxury operators stated having seen a softening in demand from Middle Eastern markets. Looking to 2018, the biennial Farnborough International Air Show returns, it’s one of the largest events in the aerospace calendar and will help provide an uplift for hotels in London and the south east.

A more unquantifiable catalyst will be how some districts, attractions and hotels capitalise on the arrival of Crossrail during 2018 and beyond.

PcW forecasts year-on-year London occupancy growth of 0.2% in 2018, taking occupancy up two percentage points to 83%.

ADR growth is forecast to increase by 2.2% in 2018. taking ADR to £148 RevPAR gain will be less than 2017, a further 2.4% in 2018, reaching £123 in 2018.

Regional occupancies have climbed back into the 70s since 2011 and have been creeping up since then. PcW's forecast for 76% this year and in 2018 would still be an achievement given an additional 7,500 rooms added in H1 2017.

Indeed, the trend is driven partly by a continuing structural supply shift towards a greater proportion of budget rooms which traditionally operate at high occupancy levels. ADR continues to recover.

In 2018, additional ADR growth of 2% is forecast. This means RevPAR growth will be 2.3% in 2018, nudging RevPAR from £52 in 2015 to £55 by 2018.

(source: PcW)