Despite the recent VAT increase and the implementation of various austerity measures expected to stifle consumer spending, hoteliers in the UK remain confident about their performance this year.

Indeed, 62 per cent of respondents to the latest HotStats Hotel Confidence Monitor reported that they were either optimistic or very optimistic about their trading performance in the first quarter of 2011. This compares to just 28 per cent who said that they were pessimistic or very pessimistic about the coming months.

According to the study, there were a number of regional differences. In London, 63 per cent of general managers expected an increase in occupancy rates compared to Q1 2010.

Outside of the capital, 47 per cent of respondents believe that they will see improved occupancy performance.

Confidence levels and performance expectations are beginning to improve, albeit gradually, but we will see soon whether the VAT increase will have a negative impact on the UK hotel market, said Mark Dickens, managing director of HotStats.