London hotels saw revenue per available room (RevPAR) increase for the first time since 2007 during the last quarter of 2009.

According to figures from Deloitte, RevPAR increased 5.5 per cent (to £110) during the three months to 31 December when compared to the same period in 2008.

Deloitte added that improved occupancy levels were a key driver of growth in the capital, as occupancy increased by 5.8 per cent to 82.9 per cent.

Marvin Rust, hospitality managing partner at Deloitte, said: "Hotels in the capital have been going from strength to strength during the last three months of 2009.

"With sterling still weak against a basket of currencies, London seems set to continue on a fast track to recovery.

"Although there may be some downward movement in average room rates in the corporate market, due to the fact that corporate rates have already been re-contracted for next year, the overseas and domestic leisure markets continue to be robust and preliminary year-end results from STR Global show a decline of just 4.8% for the capital.

Hotels outside London, however, suffered further declines in business and profitability.

Figures for hotels across the rest of the UK show revPAR fell 7.7 per cent to just £44. Both occupancy and average room rates continued to fall, down 1.1 per cent and 6.7 per cent, respectively.

Preliminary year-end results are still showing double-digit declines in revPAR.

Marvin added: "What is most worrying about the performance in the regions is that occupancy is still falling, an indication that 2010 will continue to be tough outside the capital.

"Although the first half of 2010 may show signs of recovery in occupancy (as Q1 and Q2 2009 saw significant declines), it is important to note that this may only be a "technical bounce" and the real recovery, at best, is unlikely to be before the second half of this year."