Hotels in London, UK, reported year-on-year growth with room yield rising to £112.70 from £111.14 in October 2010, driven by a 3.6% increase in room rates from £124.97 to £129.43.

Occupancy in the capital city fell for the third consecutive month, however, with a 2.1% drop to 87.1%, according to hotel data released by PKF Hotel Consultancy Services.

Room yield for the rest of the UK fell to £42.99 from £43.37, and room rates dropped to £57.75 from £59.39, although the average occupancy rate rose by 1.9% to 74.4%.

"These results demonstrate that the hotel sector is not immune to the challenges facing the economy as a whole, but is holding up well," said PKF Hotel Consultancy Services partner Robert Barnard. "Hotels across the country are operating in an unhelpful trading environment that will not improve any time soon, so it is encouraging to see room yield growth in London and an occupancy rate that remains close to 90%."