London hotels increased room rate by 12.7% to £105.77, occupancy by 2.4% to 83.1% and revpar by 15.3% to £87.89. But PKF said the seeminly healthy increases 'actually reveal only a modest rise once 2003's depressing dip in performance is corrected.'

Alex Clarke, hotel consultancy services consultant at PKF, said: 'Whilst hoteliers have made up the substantial losses reported this time last year, especially in London, the gains they've made beyond this are relatively modest.'