Everybody knows that the success of a hotel is all about its location, don’t they? Well partly yes, although there are clearly many other factors at play.
However when considering hotel occupancy and ADR projections it can be difficult to quantify what difference location alone makes. Occupancy is slightly more straight forward and is partly a factor of pricing anyway; over-simplification but more often than not, the lower the price, the higher the demand.
We’ve had a look at quantifying the difference in rate by location, as an overall average, subject of course to local factors. As this exercise is only possible when comparing apples with apples, our research has been confined to Premier Inns and a handful of markets where there are multiple numbers of them.
We have looked at average pricing for last 365 days and next 90 days from late August 2025, based on data from Lighthouse. The data used was lowest available rate including VAT advertised on the Premier Inn website on the day for historic data and on the research date for forward rates (therefore between 1 and 90 days in the future). Rates were compared for 28 Premier Inns supplying 3,905 bedrooms across seven markets (Glasgow, Inverness, Liverpool, Newcastle, Southampton, Portsmouth and York).
We have categorized locations by “city centre”, “major event venue” and “outskirts”. The graph below shows the average quoted rates (weighted by number of rooms), average sold out dates (reported by Lighthouse, historic rates only) and average Tripadvisor location score, by location type.
- Hotels at major event venues quoted slightly higher rates than city centre ones, but with fewer sold out dates, suggesting lower occupancy overall, but higher rates when there are events being held
- Average quoted rates for hotels on the outskirts were 7.6% below the city centre hotels
- But sold out days were broadly the same, which goes back to the point that lower prices will drive demand, particularly alongside good parking and public transport access.
Whist the overall findings are not surprising, the variations between destinations is interesting and confirms the need to look at each market and location individually and in detail. The graph below shows the percentage premium in average quoted rates between city centre and outskirts hotels ranging from 7.5% in Glasgow to 16.5% in Inverness.
The outlier is Southampton where the hotel on the outskirts quotes rates 6.5% higher than the three hotels in the city centre due to proximity to the M27.
So location, location, location is indeed an important factor in the level of room rates hotels are able to charge, however it is clear that there is no one size fits all answer to quantifying what that means. As always, a deep dive into the market and its demand drivers is the only way to fully understand how a hotel in a particular location is likely to perform.
If you would like more information on our services or to discuss our approach to forecasting, contact Andrew Renouf at andrew@arhospitalityconsulting.co.uk or on +44 7584 186520.