South East Hotel Development: Berkshire

Berkshire (2001 Southern Tourist Board research)

Berkshire has some of the best occupancies and highest achieved room rates in Southern England. The hotel market here is very business-driven, feeding off the Heathrow corridor/Thames Valley growth in hi-tech and the national/international corporate market. The 2001 research demonstrated that business is steady throughout the year, with strong demand and significant denials on mid-week nights.

Reading is one of the few destinations where ARRs reach £100 in 4 star hotels, where occupancy averages 80-85%. Occupancy in 3 star hotels has steadied out at around the 2001 national average, whereas the budgets are achieving 90-95%. All standards of hotel are experiencing significant levels of denials, suggesting a shortage of 4 star, 3 star and budget accommodation.
Windsor, Slough and Maidenhead hotels are also performing above the national average, with occupancy in 3/4 star hotels of 70-80% and ARRs of £79-£95 and growing. Windsor hotels are achieving higher average room rates. Slough has a very strong corporate market; conference demand is more important to Windsor and Maidenhead. There is also evidence of a long-stay corporate market using 3/4 star hotels. Denials are significant, particularly in Slough and Maidenhead (up to 100 rooms per night).
Bracknell and Wokingham hotels are also reaching the £100+ level in terms of ARR, with occupancies varying from 65-87%. The conference market is a significant component of the business segment in these hotels. All are regularly turning business away in the week (up to 80 rooms per night). Budget hotels are performing at 90%, benefiting from Legoland leisure business at weekends, and declining significant levels of business during the week.
Newbury occupancy and ARRs, whilst lower than the Reading/Slough/Bracknell area, are still in line with or exceeding national averages (65-78% occupancy, £61-£68 ARR). The development of the Vodafone headquarters here it is felt will generate significant additional demand. 4 star hotels are declining 10-15 rooms per night currently. Budget occupancies are higher at 80-85%, with significant denials Monday-Thursday.

Characteristics in Berkshire

Berkshire has a total of 83 hotels, with 5,720 rooms.
The supply is made up primarily of 4 star and 3 star hotels, with limited 2 star provision. There is one 5 star hotel (Vineyard at Stockcross, Newbury) and a good supply of de-luxe 4 star hotels (Fredericks, Maidenhead; Waterside Inn, Bray; Oakley Court, Windsor; Royal Berkshire, Ascot). There is a Warner’s adult-only hotel resort at Hungerford. Budget supply is concentrated in Reading, Newbury and Bracknell.
The main concentrations of hotel stock are Reading, Bracknell/Wokingham, Slough, Windsor, Maidenhead and Newbury.
There has been significant budget and 4 star development activity, with new 4 star hotels in Reading and Bracknell, and extensions to 4 star hotels in Reading, Newbury and Maidenhead. New budget hotels are completed or underway in Reading and Slough.

Identified sites in Berkshire:

Slough, Newbury, Windsor, Wokingham, Reading.

Gaps in Provision

The market data which we have assembled indicates potential for further hotel development in the following areas:

Windsor, Slough and Maidenhead all offer potential for further 3/4 star hotel development. In addition, there is potential for a boutique or town house hotel in Windsor. There is scope for the development of budget hotel accommodation in all 3 locations, even with the opening of the Premier Lodge at Slough.
Bracknell and Wokingham are experiencing a shortage of 3/4 star accommodation mid-week. There is potential for further 3/ 4 star hotel development, though the 4 star Grange Hotel which is under construction will meet much of the 4 star need. Both locations offer potential for budget development.

Newbury has a shortage of 3/4 star hotel accommodation mid-week. The potential for 3/4 star development may be best achieved through extensions to existing hotels rather than new build. Further budget development is needed.
Reading has a shortage of both 3/4 star and budget hotel accommodation during the week. The potential for new 3/4 star hotel development could be met in part by the expansion of the Hanover International, if this is successful at planning. There remains budget development potential and scope for boutique and town house development. There could be some danger of over supply in Reading if too many new hotels are built.

Please note that this research was conducted in 2001. There has not been any data update for this county since that time.