Staycation boom prompts investment from UK holiday let owners
Around 94% of hotel or cottage owners say they have made major upgrades to their properties since the government imposed a series of foreign travel restrictions following the beginning of the health crisis last March, according to data from the Cumberland.
The mutual says 55% of owners say they have carried out renovations, 45% have launched new services and 34% have put in new IT systems.
It added that 52% of these owners funded their investment from savings or an equity contribution, 41% used a business loan, 26% used insurance, 21% used external equity, 17% took up government-backed Coronavirus business interruption loan schemes or bounce back loan scheme loans, while 15% sought a remortgage.
The Cumberland head of commercial Scott McKerracher says: “It is very clear from our consumer research that a UK holiday is by far and away the main choice for British consumers this summer and it seems that many UK accommodation owners have decided to invest in their businesses not only for the short term but also to make long-lasting positive change.”
James Wilkinson, who owns a ten-bedroom hotel in the Lake District called the Three Shires Inn, says: “We have found that this year, people are, on the whole, looking for more comfort and luxury with a growing demand for larger bedrooms.
“Like many UK accommodation owners, we have taken the time over lockdown to make long-lasting improvements to our property to meet the anticipated needs of consumers.
“For example, we had one suite before the pandemic, but we’ve developed two more of our bedrooms into suites recently, because that is where the demand lies among visitors, and because of course, these rooms generate higher revenues for us.”
Wilkinson adds: “We’ve found that the pandemic has slightly changed people’s perceptions of what they want.
“There isn’t as much concern about any extra costs involved, but a real requirement for relaxation and comfort.
“Developing the two new bedroom suites in our property was a significant investment for us, but we could see that that is the way the market is going.
“And because of the extensive lockdown, we had time to make these changes to the bricks and mortar of our business.”
The mutual’s survey found 38% of holidaymakers said they would pay more for a hotel, B&B or holiday let which has a Covid-19 deep cleaning service, while 31% would pay more for a property with clear instructions on its Covid-19 guidance.
The Cumberland senior business lending manager Grant Seaton says: “The level of investment to which businesses are committing demonstrates optimism and resilience during a very challenging time and will hopefully be rewarded as consumer confidence and demand to holidaying in the UK continues to grow.”
The Cumberland commissioned data firm Research Without Barriers to carry out two online surveys with 1,021 UK adults and 233 UK accommodation owners and managers, between 1 June and 18 June.
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