Projections of demand and supply for visitor accommodation in London

London is the second most visited city in the world. Given the importance of tourism to London’s economy, London needs to ensure that it is able to meet the accommodation demands of tourists that want to visit the Capital.

Working Paper 88 sets out projections for the supply and demand of serviced visitor accommodation. The key points are as follows:

• London’s supply of serviced accommodation (ie, hotels, hostels, B&Bs and guest houses) in 2015 was 145,737 rooms and visitors to London have increased over the past decade reaching 31.5 million overnight visitors (domestic and international) in 2015.
• The current supply of serviced accommodation in London is tight, with the Capital having the highest occupancy rate across major European cities, and the fourth highest prices for hotel rooms.
• Demand for London accommodation is projected to reach 196.4 million nights by 2041 from 138.5 million visitor nights in 2015.
• Based on these demand projections it is estimated that London will need to add an additional 58,140 rooms to the serviced accommodation supply by 2041, at an average of 2,236 rooms per annum.