Hotel Online  Special Report




British Budget Chain Travelodge Planning a 3.5-billion-pound Expansion; 
Targeting 10% Share of the Total UK Hotel Market
21st May 2007 - Travelodge, the UK's fastest growing hotel company, today announces an unprecedented UK growth drive, pledging to treble the size of its estate by the end of 2020. The budget hotel chain will be stepping up its openings programme in 2008, adding on average 4,000 rooms (approx 40 hotels) every year up to 70,000 rooms (around 1000) hotels by the end of the next decade - targeting a 10% share of the total UK hotel market.

The programme will create an additional 10,000 jobs and mean an investment of £3.5 billion in new hotels. The major area of focus is Greater London which is expected to see a boost of 22,000 rooms alone. In Wales and Scotland, room numbers will increase by approximately 300% and 100% respectively before 2020. 

According to a Boston Consulting study* on hotel markets, the budget sector is growing at 10% each year and it predicts that the growth rate will be sustained throughout the rest of this decade and the next. Over the last 10 years, UK business stays in hotels have risen by 40%, leisure stays by 80% and short breaks by 120%. UK Hotel nights reached a peak of 148 million in 2006**.

Grant Hearn, Travelodge CEO, commented: "The major increases in visitor numbers are no surprise to us as we have watched them grow along with the rise of the budget hotel sector. In other industries such as retail, mass market brands like Tesco would always aim for at least a 10% market share. Travelodges growth strategy is designed to deliver the same strong market position. We expect to serve around 20 million customers by the end of this programme".

"The acceleration of our growth plans is extremely exciting as it enables us to capitalise on the rise in both domestic and international visits to the UK. As a management team we have a great deal of experience of opening many hotels each year and we have strengthened our property division further to achieve these new goals." 

Travelodge believes that around two thirds of its new hotels will be via organic growth but the remaining will come from regenerating existing hotels in targeted locations. The budget chain's development team has been working on adapting its hotel format so that office buildings, factories and mills as well as existing hotels can be converted to a Travelodge hotel in minimal time. 

Paul Harvey, Travelodge Property Director said: "There is no doubt that the UK hotel industry will see a major phase of regeneration over the next decade. The mid market hotels are suffering from a severe identity crisis as they no longer offer real value to the customer. As the more mature hotel markets in the US and France have seen, the branded budget sector will dominate the industry, attracting most of the mass market."

*UK Budget Hotel report Boston Consulting May 2006

**BDRC Report 2006

About Travelodge 

  • Travelodge operates 314 hotels (20,000 rooms) - nine in Ireland, three in Spain and rest in the UK. 
  • Travelodge aims to be the biggest budget operator in London by the 2012 Olympics with over 7,000 rooms in the Capital. 
  • Eighty five percent of its bookings are now made online through its industry leading website
  • Travelodge became the first UK hotel company to launch Travel Insurance in April 2007
  • Travelodge was the first budget hotel brand to launch in UK in 1985. 
  • Travelodge employs over 5,000 staff. 
  • Travelodge is owned by DIC (Dubai International Capital) 
About Dubai International Capital:
Established in 2004, Dubai International Capital LLC. (DIC) is a Dubai based international investment company that primarily focuses on private equity. It is a wholly owned subsidiary of Dubai Holding, a large and diversified group that operates in the fields of healthcare, technology, finance, real estate, research, education, tourism, energy and communications.

 Greg Dawson
01844 358644

Also See: As Head of UK's Travelodge Chain, Grant Hearn is Fond of the No-frills Approach; All Rooms Are all the Same Once the Lights Are Off / September 2006
Dubai International Capital Acquires Travelodge, Operator of 291 Hotels in the UK, Ireland and Spain, for £675 million / August 2006

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