The number of visitors booking into Inverness hotels dropped by more than 9,500 in the last year.
One leading hotelier says the Highland capital is the only major Scottish city to see a fall in occupancy.
It is feared further reductions could come as a result of the planned visitor levy which would increase room prices.
Hotels not seeing rise in visitors
While Inverness is seeing more tourists from cruise ships, fewer visitors are staying in hotels, including those opting for holiday lets.
But the hoteliers dismiss the perception that city hotel rooms are too expensive.
The Highland Hotels Association (HHA) represents 26 city hotels with 1,500 bedrooms.
In August there were 68,299 guests, compared to 77,841 at the same time in 2023 – a decrease of 9,542, or 13%.
Bookings for last weekend, normally the peak month of the year, were at 75% and as low as 55% in the next three months.
HHA chairman Fraser Peterkin said: “In these peak months everyone is struggling to get to 90% occupancy.
“If you remember, pre-Covid you could not get a room anywhere.
“We have certainly not returned to those 2018-2019 figures.
“It’s a bit concerning for the winter, which is hard enough anyway, and concerning for next year.”
‘There is a perception we are making tons of money all year’
The hoteliers say the average room rate for Inverness is around £107, much lower than often-quoted figures.
Mr Peterkin said: “People jump on the bandwagon when they see rates like £250.
“They never talk about the £60-£70 we get in winter.
“There is a perception that we are making tons of money all year round, but it’s far from it.
“There are a lot of businesses in rural areas and the city centre that run at a loss three, four or five months of the year. That’s a worry.
“That might see businesses potentially close in winter. Or, if they already close, they could extend that closing period.”
He said the planned visitor levy could put a lot of visitors off coming to Scotland and also potentially deter developers.
Tony Story, CEO of the Kingsmills hotel group, said income in August was down, with any increase in room price offset by reduced occupancy.
He said the number of rooms sold in August was down 10.3% on last year and by 11.3% in July.
In a letter to Highland Council assistant chief executive Malcolm Macleod he says projections are “similarly worrying”.
He said while Inverness numbers have decreased, occupancy is growing in Edinburgh, Glasgow and Aberdeen.
‘Keep visitor levy to a minimum’
Mr Story said the annual average rate for a group of six hotels, including the Kingsmills, was £109.23 in 2023.
He is urging the council keep the visitor levy to a minimum.
A figure of between 3-5% of an overnight stay has been suggested, but hoteliers fear it could be higher, and possibly lead to other taxes.
Mr Macleod said: ‘There will be consultation regarding visitor levy in due course to which Mr Story and all interested parties and the wider public will have full opportunity to respond to.”
The fall in occupancy comes as three new hotels are planned for Inverness.
Work is due to resume on a 72-room hotel in Church Street.
But it is unclear when two others, in Rose Street and Academy Street, will go ahead
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