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STR: U.S. hotel performance for Q2 2019

July 24, 2019 Hotel Trends No Comments Email Email

The U.S. hotel industry reported mostly positive results in the three key performance metrics during Q2 2019, according to data from STR. 

http://www.stevecafeandcuisine.com/In a year-over-year comparison with Q2 2018, the industry posted the following:

  • Occupancy: -0.1% to 70.0%
  • Average daily rate (ADR): +1.2% to US$133.01
  • Revenue per available room (RevPAR): +1.1% to US$93.17

“Despite that slight year-over-year decrease, the absolute occupancy level was the second-highest among all second quarters in our historical database,” said Alison Hoyt, STR’s senior director of consulting & analytics. “The industry sold more nights than any other Q2 in history, but supply grew at a bit of a higher rate. Aside from that, the story was really the same as the rest of the first half of 2019. Occupancy levels were mostly flat, and a lack of pricing confidence meant an uninspiring RevPAR growth rate. We’re still in an expansion cycle, but with continued expense growth, specifically in labor departments, profitability is of significant concern in a lot of markets.”

The current industry growth cycle is at 110 of 112 months with only two minor year-over-year decreases in September 2018 (-0.3%) and June 2019 (-0.4%). The longest overall expansion cycle in industry history lasted 112 months (with 111 increases) from December 1991 through March 2001.

Among the Top 25 Markets, Minneapolis/St. Paul, Minnesota, posted the largest jump in RevPAR (+5.6% to US$92.00), driven by the largest lift in ADR (+6.1% to US$128.22).

Two markets experienced the highest rise in occupancy: Chicago, Illinois (+1.7% to 77.4%) and Tampa/St. Petersburg, Florida (+1.7% to 74.6%).

Norfolk/Virginia Beach, Virginia, registered the second-largest increase in RevPAR (+4.9% to US$81.50).

Overall, 14 of the Top 25 Markets saw a RevPAR increase.

Seattle, Washington, reported the steepest decline in RevPAR (-7.1% to US$128.52), due to the largest drop in ADR (-3.9% to US$166.08) and the second-largest decrease in occupancy (-3.3% to 77.4%).

Detroit, Michigan, saw the steepest drop in occupancy (-5.0% to 68.1%) and the second-largest decline in RevPAR (-3.9% to US$72.78).

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