The Caribbean hotel market surpassed a pair of its performance peaks in 2014 and continues to show consistent growth year to date in 2015, according to STR Analytics’ 2015 Caribbean Hotel Industry Report.
Average daily rate (US$220.36) and revenue per available room (US$149.36) in the region reached record levels in 2014, while occupancy remained 3.4% below the 70.1% peak set in 2005. However, 2015 year-end occupancy should approach the historical peak in the market, as occupancy has grown by 2.9% year to date through September.
RevPAR growth in 2014 increased the Caribbean’s profitability. On a same-store, per-available-room basis, total revenue growth outpaced the increases of operating expenses, leading to a gross-operating-profit (GOP) increase of 6.4% and a net operating income (NOI) increase of 9.1%. Departmental and undistributed operating expenses saw increases of 5.6% and 3.0%, respectively.
“The Caribbean hotel market experienced strong RevPAR growth in 2014,” said Joseph Rael, senior project manager at STR Analytics. “However, 2014 HOST data revealed lower profit increases than would be expected. The Food and Beverage department and Other Operated departments, such as spa and golf, really limited the profit gains for 2014 with only modest revenue increases for the year.”
Other highlights from the 2015 Caribbean Hotel Industry Report include:
- 77.0% of Caribbean hotels that reported data experienced an increase in rooms revenue.
- Turks and Caicos was the RevPAR leader in the region during 2014 with an absolute RevPAR of US$508.00, followed by Antigua and Barbuda with RevPAR of US$488.00.
- St. Lucia (+21.7%), Jamaica (+21.1%) and Aruba (+17.4%) experienced the largest RevPAR increases in 2014.
- Utility costs decreased slightly in 2014 at -0.5% for the region.
The 2015 Caribbean Hotel Industry Report breaks down hotel industry 2014 revenues and expenses by department. For more information or to request the full, complimentary Caribbean Hotel Industry Report, please contact [email protected].