Whitbread, owner of the Premier Inn and Hub by Premier Inn hotel brands, is continuing to expand the business across the UK and German markets, shaking off short term worries over weaker trading towards the end of 2024.
In a trading update for its third quarter, to the end of November 2024, Whitbread reported a softer UK market, with revpar down 3%. In contrast, accommodation revenues in Germany were up 23% thanks to the number of newly opened hotels across the country.
A fresh focus on accommodation
Short term, trading in the UK has been impacted by the company’s Accelerated Growth Plan, which sees the business selling off or closing its food and beverage outlets alongside many of its hotels. Where restaurants are being closed, they will be converted to provide additional hotel rooms, due to come on stream within the next year or two. At those sites, a new breakfast room space is also being created, with Premier Inn committed to continuing to offer its famous cooked breakfast choice.
In the UK, Premier Inn has a dominant market position, something it is seeking to replicate with growth in Germany. “The structural shift in UK supply has meant that Premier Inn is continuing to sustain the significant gains made since the pandemic,” said CEO Dominic Paul. “Whilst forward visibility remains limited, the favourable supply backdrop, together with our brand strength and commercial initiatives, means we are confident that we can continue to outperform the market.”
The group opened seven new hotels in the UK during the first nine months of its most recent financial year, in a period running from March to December 2024. The additions were in Bristol, Cambridge, Torquay, York and across London, with the last launch of 2024 being a new 137 room hotel in the capital’s Waterloo district. Altogether, more than 1,000 rooms were added to the UK portfolio as a result.
All of the openings were leasehold properties, with Whitbread agreeing to pay rent to a landlord. Three of the sites were hotels created by the reuse of former office buildings.
A strong pipeline in UK and German markets
Whitbread has an impressive pipeline of additional properties. Work is well under way on a 212 Hub by Premier Inn hotel in Snow Hill, London, with opening planned for early 2026. Airport hotels feature too, with plans to add hotels at Edinburgh and Belfast airports.
Work is under way on a development in Manchester while the group acquired an office building in Leeds for conversion to a Premier Inn. And in October 2024, the group received approval for development of a new 693 room Hub by Premier Inn close to London’s Trafalgar Square.
In Germany, where Premier Inn is still a relatively new brand to the market, growth is happening at pace. Already under construction are hotels in Bamberg, Duisburg, Halle Am Opernplatz, Hannover City Centre and Kassel. Many more are in the planning process, including Dusseldorf, Erfurt, Frankfurt City Ostbahnhof, Ingolstadt and Rostock City Hafen.
