FAREHAM MARKET FACT FILE

July 2019

INTRODUCTION

The /Whiteley Hotel Market Fact File provides the latest available information on:

• The current hotel supply in the Fareham and Whiteley area; • Recent hotel development; • Current hotel development proposals; • Recent hotel performance (2016-2018) • The key markets for hotel accommodation in the area; • The future prospects for area’s hotel market.

All of the data and information included in the Fact File is drawn from a survey of Fareham and Whiteley hotel managers undertaken by consultants Hotel Solutions between May and July 2019.

For further information and contacts or to discuss your requirements contact:

Andrew Bateman Tourism Manager Economy, Transport & Environment County Council EII Court West Winchester SO23 8UD

Tel: 01962 845478 Email: [email protected]

Fareham/Whiteley Hotel Market Fact File 1 July 2019

FAREHAM/WHITELEY HOTEL SUPPLY

Current Hotel Supply

• Fareham and Whiteley are currently served by a total of 13 , with 763 letting bedrooms. 4-star hotels account for just over 44% of this hotel stock. This includes Hotel & Spa at Whiteley and two 4-star hotels in the surrounding rural area at Shedfield (the Meon Valley Hotel Golf & Country Club) and Shirrell Heath

(New Place). There are no 4-star hotels in Fareham.

CURRENT HOTEL SUPPLY – FAREHAM/WHITELEY JULY 2019

Standard Hotels Rooms % of Rooms 4 star 3 338 44.3 Boutique 1 16 2.1 3 star 7 294 38.5 Budget 1 78 10.2 Serviced Apartments 1 37 4.9 Total Hotels 13 763 100.0

• 3-star hotels account for 38.5% of the area’s hotel supply. Provision at this level is dominated by the Fareham-Solent at Titchfield. The Lodge at Solent operates as an annex to the Solent Hotel & Spa at Whiteley. The area’s 3-star hotel supply otherwise comprises a mix of mainly small, independent 3-star hotels,

located primarily in Fareham.

• The area only has one budget hotel – the Fareham at .

Fareham/Whiteley Hotel Market Fact File 2 July 2019

FAREHAM/WHITELEY HOTEL SUPPLY

FAREHAM/WHITELEY HOTEL SUPPLY –JULY 2019

Hotel Standard/Type Bedrooms

Fareham Red Lion (Old English Inns) 3 star 46 Lysses 3 star 21 TravelRest Solent Gateway 3 star 19 Roundabout 3 star 16 Whiteley Solent Hotel & Spa 4 star 115 The Lodge at Solent 3 star 54 Park Gate Premier Inn Fareham Budget 78 Titchfield Holiday Inn Fareham 3 star 130 The Bugle Hotel 3 star 8 Green Coldeast Mansion Serviced Apartments 37 Wickham The Old House, Wickham Boutique 16 Shedfield Meon Valley Hotel, Golf & Country Club 4 star 113 Shirrell Heath New Place 4 star 110

Fareham/Whiteley Hotel Market Fact File 3 July 2019

FAREHAM/WHITELEY HOTEL SUPPLY - CHANGES

Changes in Supply 2014-2019

New Hotels

• The Lodge at Solent opened at Whiteley in August 2017.

• The Coldeast Mansion serviced apartments at Sarisbury Green opened in 2015.

Investment in Existing Hotels

• The Premier Inn Fareham added 17 bedrooms in 2017.

• The Holiday Inn Fareham-Solent added 6 bedrooms in 2016, through the conversion of some of its meeting rooms.

• New Place was acquired by the overseas hospitality investor Mokan Hotels in 2017 from the Principal Hotel Company, which had operated it as a De Vere Venues residential conference and training centre. It is now operating fully as a hotel and has undergone a full bedroom refurbishment.

• The Meon Valley Hotel, Golf & Country Club was acquired by in 2018 as part of a package of five UK hotels that the company purchased from Marriott Hotels.

Fareham/Whiteley Hotel Market Fact File 4 July 2019

FAREHAM/WHITELEY HOTEL SUPPLY - CHANGES

Proposed Hotel Development

Hotels Under Construction

• There are no hotels currently under construction in the Fareham and Whiteley area.

Proposed Hotels

• There are two current proposals for new budget hotels at Fareham and Whiteley:

o Planning permission was granted in 2017 for an 84-bedroom Premier Inn budget hotel at Fareham Shopping Centre. The hotel is due to be on site in 2019 and to open in 2021.

o A 94-bedroom Travelodge budget hotel is proposed as part of a £20m mixed-use development on land north of the Forum Buildings at the Solent Business Park. The scheme also includes a restaurant, gym, day nursery, light industrial units and multi-storey car park. A planning application for the scheme was submitted to Winchester City Council in April 2019.

Planned Development of Existing Hotels

• In terms of planned investment in existing hotels:

o New Place has planning permission to convert the main house into 14 guest suites.

o The public areas of the Holiday Inn Fareham-Solent will be refurbished by 2020 to meet IHG’s Open Lobby brand standard, providing a more fluid eating, drinking, working and socialising space for guests.

Fareham/Whiteley Hotel Market Fact File 5 July 2019

FAREHAM/WHITELEY HOTEL PERFORMANCE

Occupancy, Achieved Room Rates and Revpar

• Average annual room occupancies, achieved room rates and revpar figures for Fareham/Whiteley 3/4-star hotels for 2016, 2017 and 2018 are summarised in the table overleaf.

• Fareham/Whiteley hotel performance has been well below the national averages for UK provincial 3/4-star chain hotels over the last three years by all performance indicators. This is largely due to the lack of weekend demand and a largely price-driven, low-rated leisure market for hotel accommodation here.

• The average figures mask differences between hotels however. One hotel pursues a high rate/ lower occupancy strategy, while the others are currently more focused on driving occupancy than room rate.

• Room occupancies have slightly increased over the last three years for 3/4-star hotels in the Fareham/Whiteley area, but achieved room rates have fallen sharply year-on-year. This has been as a result of a more competitive hotel market in the area as the hotel supply has increased, with the opening of The Lodge at Solent and the expansion of the Premier Inn Fareham, together with the opening of the new Village Portsmouth hotel, which has resulted in lower levels of corporate business from Portsmouth being displaced to Fareham and Whiteley hotels.

• While data cannot be published for budget hotel performance in the Fareham/Whiteley area (as there is only one budget hotel here currently), local demand for this standard of hotel is very strong, and not currently satisfied by existing provision at this level in the market.

Fareham/Whiteley Hotel Market Fact File 6 July 2019

FAREHAM/WHITELEY HOTEL PERFORMANCE

FAREHAM/WHITELEY 3/4 STAR HOTEL PERFORMANCE 2016-2018

Location/ Standard of Hotel Average Annual Average Annual Average Annual Room Occupancy Achieved Room Revpar 5 % Rate 4 £ £ 2016 2017 2018 2016 2017 2018 2016 2017 2018 UK Provincial 3/4 Star Chain Hotels 1 75.6 76.5 76.7 83.22 86.43 88.95 62.66 66.14 68.19 UK Provincial Hotels (All Standards)2 76 76 76 69 71 72 52 54 55 Fareham/Whiteley 3/4 Star Hotels 3 67.6 69.0 71.0 82.70 79.79 75.53 55.90 55.02 53.62

Source: Hotel Solutions survey of Fareham and Whiteley hotels May-July 2019

Notes 1. Source: TRI Hotstats UK Chain Hotels Market Review 2. Source: STR Global 3. Sample: Solent Hotel & Spa, The Lodge at Solent, New Place, Holiday Inn Fareham-Solent 4. The amount of rooms revenue (excluding food and beverage income) that hotels achieve per occupied room net of VAT, breakfast (if included) and discounts and commission charges. 5. The amount of rooms revenue (excluding food and beverage income) that hotels achieve per available room net of VAT, breakfast (if included) and discounts and commission charges.

Fareham/Whiteley Hotel Market Fact File 7 July 2019

PATTERNS OF DEMAND

Patterns of Demand

• Estimated average weekday and weekend occupancies for Fareham/Whiteley 3/4-star hotels in 2018 are summarised in the table below.

FAREHAM/WHITELEY 3/4 STAR HOTELS - WEEKDAY/ WEEKEND OCCUPANCIES – 2018

Typical Room Occupancy % Mon-Thurs Fri Sat Sun 78 59 78 43

Source: Hotel Solutions survey of Fareham and Whiteley hotels May-July 2019

• Room occupancies for Fareham/Whiteley 3/4-star hotels are very strong on Tuesday and Wednesday nights throughout the year, with most hotels frequently filling and turning business away on these two nights. Monday, and especially Thursday occupancies are generally lower and hotels usually have availability on these nights.

• Saturday occupancies are strong for most hotels, particularly between April and October, when hotels sometimes fill and turn business away on Saturday nights. Friday, and especially Sunday occupancies are much lower and hotels rarely fill, or get close to filling, on these two nights. Weekend room rates are generally low, with hotels primarily attracting weekend leisure business on price.

• Budget hotels typically attract a good mix of business and contractor business that delivers high room occupancies from Monday to Thursday. They also attract strong weekend demand from a mix of leisure markets that enables them to achieve high Friday and Saturday occupancies. Sunday nights are generally the only weaker night for budget hotels.

Fareham/Whiteley Hotel Market Fact File 8 July 2019

FAREHAM/WHITELEY HOTEL MARKETS

Market Mix

• Estimates of the midweek and weekend market mix for Fareham/Whiteley 3/4- star hotels are set out in the tables below.

FAREHAM/WHITELEY 3/4 STAR HOTELS – MIDWEEK MARKET MIX 2018

Market Segment Corporate Contractors Conference Leisure Other 64 6 20 5 5

FAREHAM/WHITELEY 3/4 STAR HOTELS – WEEKEND MARKET MIX 2018

Market Segment Corporate Conference Weddings/ Leisure Group Tours Functions 6 2 20 59 13

Source: Hotel Solutions survey of Fareham and Whiteley hotels May-July 2019

Midweek Markets

• Local corporate demand from companies and organisations in Whiteley (Solent Business Park), Segensworth, Titchfield and Fareham is the primary source of midweek demand for Fareham/Whiteley 3/4-star hotels, accounting for 64% of midweek occupancy.

• Residential conferences are the core midweek market for one hotel that has a strong track record in this market, but only a minor market for other hotels.

• Other lesser sources of midweek business for the area’s 3/4-star hotels are contractors, midweek leisure breaks, ferry passengers departing from Portsmouth, and cruise passengers leaving from .

• Some Fareham/Whiteley hotels attract additional midweek business during the Southampton Boat Show, primarily in terms of corporate business that is displaced from Southampton, rather than demand specifically related to the Boat Show itself. In a similar way, some hotels also attract displaced corporate business from Farnborough during the Farnborough Air Show, when it is held every other year.

Fareham/Whiteley Hotel Market Fact File 9 July 2019

FAREHAM/WHITELEY HOTEL MARKETS

• Budget hotels typically attract a good mix of midweek business from contractors and the local corporate market.

Weekend Markets

• Weekend leisure breaks are the key weekend market for Fareham/Whiteley 3/4-star hotels, accounting for 56% of weekend occupancy. Key drivers of weekend break stays are Peppa Pig World and Portsmouth Historic Dockyard. This business is largely price driven, through online booking channels and deal sites such as Holiday Extras, Secret Escapes and Living Social, and through hotel company short break programmes.

• With its spa, the Solent Hotel & Spa is able to attract weekend spa break business.

• Events that generate weekend demand for Fareham/Whiteley hotels are:

o The D-Day 75 th Anniversary events in Portsmouth in June 2019; o Great South Run, Portsmouth; o South Central Festival, Portsmouth; o Victorious Festival, Portsmouth; o Wickham Festival; o Cowes Week; o The ICC Cricket World Cup matches at the Ageas Bowl in June 2019; o Goodwood Festival of Speed; o Goodwood Revival; o Glorious Goodwood.

• Weddings generate strong weekend demand for two of the 3/4-star hotels in the Fareham/Whiteley area, and are a minor source of weekend business for other 3/4-star hotels. This includes weddings held at the hotels and at other venues, including the Skylark Golf & Country Club at Whiteley and the Great Barn at Titchfield Festival Theatre. People attending weddings and family parties are typically a strong weekend market for budget hotels.

Fareham/Whiteley Hotel Market Fact File 10 July 2019

FAREHAM/WHITELEY HOTEL MARKETS

• Other minor weekend markets for Fareham/Whiteley hotels are:

o UK and European group tours for two 3/4-star hotels; o Overseas tourists; o Ferry passengers departing from Portsmouth; o Cruise passengers leaving from Southampton; o Weekend conferences; o Long stay corporate visitors staying over the weekend and corporate arrivals on Sunday nights; o People visiting friends and relatives.

Fareham/Whiteley Hotel Market Fact File 11 July 2019

MARKET TRENDS

Market Trends

• One of the Fareham/Whiteley 3/4-star hotels reported an increase in business in 2018 from some of the government bodies in the Fareham/Whiteley area and additional project-related corporate demand from local companies.

• Fareham/Whiteley 3/4-star hotels have seen a drop in displaced corporate demand from Portsmouth since the opening of the new Village hotel here in November 2017.

• There have been no changes in residential conference business for Fareham/Whiteley 3/4-star hotels over the last three years.

• Two hotels have driven growth in leisure break business by targeting the Peppa Pig World market through Holiday Extras and through special offer promotions through hotel company short break programmes and some of the deal sites such as Secret Escapes and Travelzoo.

• One hotel reported an increased in group tour business from Europe.

• Weddings business has increased for one hotel but not changed for the others.

Fareham/Whiteley Hotel Market Fact File 12 July 2019

DENIED BUSINESS 1

Denied Business

• Two of the 3/4-star hotels in the Fareham/Whiteley area regularly deny corporate business on Tuesday and Wednesday nights, but not to a significant extent. The other two hotels only occasionally deny business on Tuesday and Wednesday nights. Hotels rarely fill on Monday and Thursday nights.

• Three 3/4-star hotels occasionally fill and turn business away on Saturday nights in the summer. The other hotel rarely denies any business on Saturday nights. Hotels do not generally fill on Friday nights and very rarely on Sunday nights.

• While data on budget hotel denials cannot be published for the Fareham/Whiteley area, there are frequent shortages of provision at this level, both during the week and at weekends.

______1. Business that hotels have to turn away because they are fully booked.

Fareham/Whiteley Hotel Market Fact File 13 July 2019

FUTURE PROSPECTS

Prospects for 2019

• Fareham/Whiteley 3/4-star hotels generally expect to see little change in their performance in 2019. Most hotels expect room occupancies to remain the same as 2018 or be slightly down. One hotel is projecting further occupancy growth as it targets leisure business more proactively.

• Two hotels expect to see an increase in achieved room rates as they become more established and their occupancies increase. One expects to see little change, while another is projecting a further drop in achieved room rates in 2019.

• The key negative factor in 2019 is the Brexit uncertainty, which has affected corporate and residential conference business. On the positive side, the D-Day 75 th anniversary commemorations in Portsmouth and ICC Cricket World Cup matches at the Ageas Bowl have provided a significant boost to hotel demand in June.

Prospects for 2020 and Beyond

• The longer-term outlook for Fareham/Whiteley 3/4-star hotels is very much dependant on what happens with Brexit and the national economy. All hotel managers expect their hotels to be impacted by the planned Premier Inn at Fareham and the proposed Travelodge at Whiteley if they go ahead.

Fareham/Whiteley Hotel Market Fact File 14 July 2019

SOURCES OF FURTHER INFORMATION

For further information and contacts or to discuss your requirements contact:

Andrew Bateman Tourism Manager Economy, Transport & Environment Hampshire County Council EII Court West Winchester SO23 8UD

Tel: 01962 845478 Email: [email protected]

Fareham/Whiteley Hotel Market Fact File 15 July 2019