SCOTLAND'S ailing tourism sector was dealt a further blow yesterday as it emerged hotel occupancy rates had fallen more than anywhere else in Britain.
Rates across Scotland fell 6.8 per cent in May compared with the same month last year. Although the average occupancy rate across the UK was down 0.3 per cent,
Glasgow's hotels were down 12.3 per cent, while Edinburgh's and Aberdeen's were down
5.6 and 5.1 per cent respectively.
The figures follow a similar pattern to those unveiled for April by market analysts PKF. Then, Edinburgh's occupancy rate was worst hit, down 5.2 per cent compared with April 2007.
The firm believes a combination of a cut in corporate spending due to the credit crunch and a slump in short-break business is to blame.
Alastair Rae, a partner in the hospitality and leisure sector at PKF, said: "It's clear that Scotland is now experiencing a downturn in the hospitality sector.
"Given that 2007 was an excellent year for the hotel sector in Scotland, it was almost inevitable the 2008 figures would be down on the previous year.
"But there are signs that there has been a steep fall in certain parts of the country, with Glasgow experiencing the largest drop of any city in the UK in both occupancy and rooms yield, probably due to a reduction in corporate spending.
"Edinburgh has also experienced a slowdown which is, in part, attributable to a reduction in holiday visitors and also continued pressure on the financial services industry as the impact of the credit crunch continues to be felt.
"The picture across the UK is more positive but this could be affected by single events, such as Cardiff hosting rugby's Heineken Cup Final in May. Equally, Liverpool is benefiting from its tenure as the European City of Culture."
VisitScotland has already been forced to reallocate £1.5 million from its US marketing budget to try to woo visitors from the UK, Europe and Canada to come to Scotland over the summer.
The tourism sector is thought to have suffered badly over the last few months because of the rising US dollar, fuel price hikes and the credit crunch.
But hoteliers said that the industry could recover over the next few months if it properly targeted people who had scrapped plans to take a foreign holiday and also pitched their prices at the right market.
Peter Dornan, the chairman of the Edinburgh Principal Hotels Association, which represents three-, four- and five-star hotels in the capital, said: "I don't think we should be too despondent at the moment. People are definitely booking later and later this year and we should be looking at how to attract the last-minute customer by making prices as attractive as possible."
The Scotsman revealed last month that hotels and guest-houses had suffered a major slump in bookings for the normally lucrative summer festivals season.
Hundreds of private flats were still being advertised on the message boards of the Fringe website yesterday, many of them posted in the last few days.
Ron Hewitt, the chief executive of Edinburgh Chamber of Commerce, said: "While we would be foolish to ignore the early warning signs of a dip in the market we should also take this report cautiously.
"We are just entering peak season for Edinburgh and measuring our hospitality sector's performance can only be done effectively over the whole year.
"While any prudent manager will be accounting for an international drop in consumer confidence, early indications are that while we might not reach last year's peak, this will be a very successful festival season."
The full article contains 617 words and appears in The Scotsman newspaper.
