Premier Inn’s plans for the North West

A reduction in the UK’s hotel room supply spells opportunity for ambitious and affordable hotel chains like ours, writes Jill Anderson of Whitbread.

Based on Whitbread research, the number of hotel rooms in the UK has decreased from 715,000 in 2019 to around 680,000 today. We believe that it will take at least another four years for total hotel bedroom supply to return to pre-pandemic levels in the UK.

From our own research, we believe it is the smaller and less visible operators that have left the UK market. Most of these independent hotels we think will never return as hotels but will be converted into alternative uses, if they haven’t already been.

Several factors are at play for this shift including high operational costs such as wages, utility bills, and the commissions paid to online travel agents for bookings to name a few. Another is that consumer preferences are changing towards the certainty and consistency offered by branded hotels.

I mention this as it is important context underpinning the opportunity for Premier Inn in the UK. We see a strategic opportunity to grow our own network here in the UK and add bedroom capacity across the country from 85,000 Premier Inn rooms today towards a long-term potential of 125,000 UK rooms.

If you have ever stayed with Premier Inn, you will appreciate the flexibility of our product. We’re as popular with business customers as we are with our leisure travellers across our network and our ‘kids eat free’ policy and flexible room types makes us an attractive choice for families.

Credit: Whitbread PLC

This mix of business and leisure customers influences where we are seeking to grow Premier Inn. Globally recognised visitor destinations such as the Lake District will always be a somewhere we wish to expand into. But so are those places which provide attractive hotel investment opportunities on account of their strong business economies and year-round leisure visitor demand.

I’m thinking here of places such as Lancaster, Carlisle, Lytham St Annes, and Grange-Over-Sands – all of which we are seeking to expand our offer into – alongside the more obvious locations within the Lake District National Park. The same is true of other locations in Lancashire, Yorkshire, and Liverpool. Currently across the north of England we are searching for 24 new sites for Premier Inn.

The importance of a mix of visitor accommodation was a theme of a hospitality focused panel discussion I was part of at the recent Place North West Cumbria Development Update. Although the panellists didn’t agree on everything, the data sets we shared during the conversation did all evidence the positive impact of hospitality to local economies.

Premier Inn Keswick completed in 2023. Credit: Whitbread PLC

Our own research puts the external visitor expenditure of Premier Inn stays in ‘adventure’ locations like Cumbria at £131 per bedroom per night – a figure which quickly multiplies into multi-million-pound sums of additional annual spending by our guests on account of the high year-round occupancy of Premier Inn hotels.

I see this external expenditure, as well as the permanent year-round employment opportunities we create, as important ways Premier Inn will contribute to the success of Cumbria and the wider North West region over the long-term. We always appraise new development opportunities over a 25-to-30-year period and when we find one, we bring a package of impactful social benefits to the communities we serve.

I am confident we will be able to demonstrate this in the new locations we are seeking to expand into soon.

• Jill Anderson is acquisitions manager at Whitbread