UK Hotels Bounce Back, But London and Budget Offerings Underperform
Photo Credit: Exterior of IHG's Crowne Plaza London Docklands, UK. IHG
Skift Take
A stronger second half helped the UK hotel market recover in 2025, but London lagged, and rising costs mean many operators are still struggling to grow profits.
The UK hotel market recovered in the second half of 2025, offsetting a weaker start to the year.
However, the rebound was uneven, with London underperforming and hotel operators still facing pressure on profits.
“It was a fairly stable year,” Cristina Balekjian, senior director of UK hospitality analytics at CoStar Group, told Skift. “It was a year of two halves as well, because the first half was quite difficult, quite challenging, with consumer confidence down, business confidence down.”
Consumer and business confidence were weaker in the first half as cost-of-living pressures and softer post-pandemic demand made both leisure and business travel more cautious.
Sentiment improved as summer demand, major events, and more stable trading supported a modest recovery.
CoStar’s
