UK Hotel Insolvency Statistics

Falling, on both measures. There were 80 insolvencies from January to June 2026 against 89 in the same months of 2025, down 10.1%, and the rolling 12-month total fell from 152 to 145, down 4.6%. That is a genuine improvement and it deserves to be said plainly before the qualification.

These are Company Debt calculations from Insolvency Service Table A1b data.

The qualification is the company hotels are keeping. Accommodation as a whole fell 19.9%, from 136 to 109. Holiday and short-stay lets fell from 18 to 6, and other accommodation from 22 to 19.

Every neighbouring format is recovering faster than hotels are, which is why hotels now make up 73.4% of all accommodation insolvencies against 65.4% a year ago.

The other thing worth knowing is that 2025 was the worst year on record for hotels, at 154. Most of the economy peaked in 2023 and has been recovering since. Hotels peaked last year.

A 10.1% improvement from the worst point in the series is progress from a low base, not a return to health.

Hotels are the heaviest, most capital-intensive way to sell a bed for the night, and they are the format recovering most slowly. The lighter formats, without a payroll and a boiler and a breakfast service, have come back fastest.

Two cautions on the table below. The holiday-let and other accommodation series are small, so a move from 18 cases to 6 is a real direction but a shaky percentage, and should not be read as precision.

Because hotels are roughly three-quarters of accommodation, the division line is largely hotels looking at themselves.

Restaurants are in the table because they are the most useful sibling comparison rather than a competitor: same customer, same staffing market, same energy bills, very different balance sheet. They fell 6.2%. Their figures are on our restaurant insolvency statistics page.

Hotels do not fit the pattern the rest of this data follows, and it is worth understanding why before reading anything else on this page. Insolvencies ran at 80, 89 and 96 from 2016 to 2018. Then 2019 came in at 144, a jump of 50% in a single year, before the pandemic and before anything else on these pages went wrong.

Then the strangest number here. In 2020, company insolvencies across the whole economy fell 26.4% as government support and the restrictions on creditors held the normal cycle in check. Hotels went from 144 to 143. They did not get the quiet year that almost every other sector got. Whatever the support schemes did, they did not reach the hotels that were already going.

2021 brought the delayed reprieve at 97, then 125 in 2022, 144 in 2023 and 136 in 2024. And then 154 in 2025, the highest in the series.

Hotels have now been at or near their 2019 level for the best part of seven years, which is a long time to describe something as a recovery.

In the hotel cases we handle, the building is usually both the problem and the only reason there is anything left to talk about. It is what the borrowing is secured on, it is what makes the fixed costs unavoidable, and it is the reason a buyer might take the whole thing on rather than walk away. Very few of the trades we work with have that last part.

By the time a director calls us, the pattern is usually two or three soft quarters, a covenant conversation that went badly, and a refurbishment that has been deferred twice and cannot be deferred again without losing the rate. Meanwhile the deposits for next season’s bookings are sitting in the account, which makes the bank balance look considerably better than the business is.

That last point deserves saying out loud, because it catches people. Forward bookings are other people’s money. Spending them on this month’s wages is one of the most common things we see in this trade and one of the hardest to come back from, because the rooms still have to be provided later with no cash attached to them.

So we would not start with occupancy. We would look at what the building costs to open the doors each month before a single room sells, the debt service against actual trading, how much of the cash in the account is forward deposits, what the rates bill looks like under the 2026 multipliers, and what is owed to HMRC on VAT and PAYE. Those five tell you how much time there is.

This one is worth understanding properly, because it changed in April and a lot of budgets were built on the old arrangement. Up to 31 March 2026, eligible retail, hospitality and leisure properties in England got 40% off their business rates bill, capped at £110,000 per business, with the cap applied across a group rather than per property.

From 1 April 2026 that relief was replaced by permanently lower multipliers. For 2026 to 2027 in England, a hospitality property with a rateable value below £51,000 is charged at 38.2p against the 43.2p small business multiplier, and one between £51,000 and £499,999 at 43p against the 48p standard multiplier. In both cases that is 5p in the pound less than an equivalent non-hospitality property.

The catch is at the top. A property with a rateable value of £500,000 or more is charged at 50.8p, the highest multiplier there is, and gets no hospitality discount at all. Plenty of city-centre and larger hotels sit above that line.

Whether any individual hotel is better or worse off is genuinely not something we can tell you from here, because the 2026 revaluation reset rateable values at the same time.

What can be said is the arithmetic. A 5p cut in the multiplier is a smaller benefit than 40% off the bill was, so a hotel that sat comfortably inside the old cap and whose valuation held steady should expect to pay more in 2026 to 2027, not less. The trade-off is that this one is permanent and does not have to be argued for again every autumn.

Sources: GOV.UK, Business Rates Relief 2025/26 Retail, Hospitality and Leisure Scheme, and GOV.UK business rates multipliers for 2026 to 2027. England only. Business rates are devolved, so Wales differs.

The number to look at here is administrations, not liquidations. At 9.8% of 2025 cases, hotels use administration more than any other sector on these pages: garages are at 2.4% and cleaning contractors at 1.2%. In 2019 the hotel share was 22.2%.

That difference is the building. Administration exists to rescue a business or get a better result than winding it up, and it needs something worth buying. A hotel is a real asset in a real location with a trading history attached, so there is usually somebody who wants it at a price. Most trades in difficulty have nothing comparable to sell.

Creditors’ voluntary liquidations still account for three-quarters of cases, 115 of 154, up from 96 in 2024, and compulsory liquidations rose from 17 to 20. So the rescue route is more available in this trade than in most, which is not the same as it being the likely outcome.

SIC group 551 covers companies whose recorded primary business is hotels, motels and similar short-stay accommodation, typically with daily housekeeping. Self-catering and holiday lets sit under SIC 552, and restaurants and pubs under SIC 561 and 563. A hotel with a busy restaurant is still counted once, under whichever code it registered.

The 2019 figure deserves a note of its own. Hotel insolvencies jumped from 96 in 2018 to 144 in 2019, a 50% rise before the pandemic. Table A1b does not break down far enough to explain that, and we have not attributed it. It does mean the pre-pandemic comparison used elsewhere on this site is a weaker yardstick here than on other pages, and it should be treated with care.

Hotels are a small sector by company count, at roughly a dozen insolvencies a month, so single months move on a handful of cases. The year-to-date and 12-month rolling totals are the steadier guide.

These are company counts, not the number of hotels, rooms or staff affected. One insolvent company may operate several properties, and a hotel can close or change hands without any formal insolvency procedure. Hotels also change hands as assets more often than most businesses, so a property continuing to trade under a new name tells you nothing about whether the company that ran it survived.

The figures are insolvency volumes, not a failure rate. They are not adjusted for the number of active hotel companies.

The SIC 551 figures come from Table A1b and are not seasonally adjusted, which matters more for hotels than for most sectors given how seasonal the trade is. The Insolvency Service seasonally adjusts parts of its headline England and Wales series where it finds seasonality, but that adjustment does not apply to the industry figures used here. The latest month is provisional and can be revised.

None of the figures above decide whether your hotel is viable. Sector totals never do. The questions that matter are narrower: what does it cost to open the doors each month before a room is sold, does trading cover that plus the debt service across a full year rather than a good quarter, and how much of the money in the account has already been spent by guests who have not arrived yet?

Hotels have one advantage over most of the trades we work with, and it is worth knowing about early rather than late. Because the building is a real asset, there are usually more options than a straight liquidation: a sale of the business and assets, a refinance, or a rescue procedure that keeps the doors open while it is arranged.

That is why administrations are a far larger share of hotel insolvencies than of any other sector on this site. It is the one genuinely encouraging structural fact on this page.

Those options need time, and they need the building to still be worth something. If the covenant conversation has already happened, the useful step is to take advice while there is still a business attached to the asset: terms renegotiated, an HMRC Time to Pay arrangement, or a rescue procedure such as a Company Voluntary Arrangement or administration.

Leave it until a winding-up petition is advertised and the account is frozen within days, the bookings stop, and the asset you were relying on is suddenly being valued as an empty building rather than a trading hotel. At that point creditors’ voluntary liquidation is often what is left. Our insolvency advice for directors is the place to start.