Capital's restaurants suffer worst year in decade

Some of the best-known names in the British restaurant industry have been worst hit by a sharp downturn in trade caused by the 11 September terrorist attacks.

Some of the best-known names in the British restaurant industry have been worst hit by a sharp downturn in trade caused by the 11 September terrorist attacks.

The absence of Japanese and American high-spending visitors has added to the woes of an industry already experiencing its worst year for a decade because of the foot-and-mouth crisis.

Although areas popular with overseas visitors such as Stratford-upon-Avon, Bath and Edinburgh have also been affected, the plight of restaurants and hotels in London is without parallel.

London hotels have shut rooms for redecoration and chains have offered cut-price offers and package deals to try to attract tourists.

Hilton alone has seen occupancy rates in its 13 London hotels decrease by 20 per cent since the hijackings.

Ossie Gray, the general manager at the River Café, said its lunchtime trade had fallen by as much as 15 per cent. Even among the British customers, he said there was a more "sombre" atmosphere and a reluctance to dine out. "Almost immediately, within a matter of hours [of the attack], I was receiving e-mails from Americans cancelling," he said.

"We traditionally got a lot of Americans in the autumn because they do European tours. But in general the American demand has diminished to a trickle."

Martine de Geus, of the Dorchester Hotel, said that its restaurant's fortunes had fluctuated widely. "Some of that is directly affected by our rooms business, which is down," she said.

The Park Lane restaurant Chez Nico experienced a sharp downturn in fortunes in the first two weeks after the attacks before trade rallied. The hotel's management said the crisis had highlighted how dependent London was on the tourist industry.

The Restaurant Association predicted that although high-profile restaurants would survive, many middle-ranking eateries would go bust early next year. Ian McKerracher, the organisation's chief executive, said some restaurants were typically reporting a downturn of about 20 per cent in trade after 11 September and suppliers were also feeling the pinch.

"There are a lot of very nervous and apprehensive restaurateurs who remember the Gulf War when there was severe damage to the industry. But it is a much more robust industry now."

He said there had been a lack of political leadership backing the industry in London. "If there is one thing Ken Livingstone could do, and do urgently, it is to stand up and champion how good London is."

A spokeswoman said the Mayor was launching a campaign tomorrow to encourage people back into London. She said Mr Livingstone would present the Government with a series of proposals in two weeks' time to help the tourism industry's recovery.

"Ken is not about orchestrating photo opportunities, he wants to do something substantive," she said.

Tourism officials were planning to focus on Europe to try to replace the missing visitors. Miles Quest, of the British Hospitality Association, said: "Our feeling is that trying to promote the UK to the North Atlantic market at the moment is like throwing good money after bad. I don't think the Americans are receptive to any messages we are sending out."

The London Tourist Board predicted that the combined effects of foot-and-mouth and the terrorist attack could cost London £1.5bn this year, with spending falling from £8bn to £6.5bn.

A study of businesses linked to tourism in the capital revealed that 88 per cent had experienced a decline in visitors or bookings since the attacks.

Peter Backman, from the industry researchers Foodservice Intelligence, said the effect of the attacks on the restaurant trade as a whole was still unclear. Researchers had charted an 8 per cent decline in restaurant trade across the country in September compared with the previous year, which was in line with what had already been seen in 2001.

"The top-end restaurants have been badly hit and hotels badly hit as well but the overall effect has been quite muted," Mr Backman said.

London's plight has contrasted with more encouraging signs from hotels in Devon, Cornwall and Cumbria, which are less dependent on overseas trade and appear to have benefited from the increasing willingness of Britons to holiday at home to avoid travelling on airliners.