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STR: US hotel performance for October 2016

November 25, 2016 Hotel Trends No Comments Print Print Email Email

The U.S. hotel industry reported mostly positive year-over-year results in the three key performance metrics during October 2016, according to data from STR.http://www.thavornpalmbeach.com/phuket-luxury-holiday-package/

Compared with October 2015, the U.S. hotel industry’s occupancy was nearly flat, down 0.3% to 68.6%. However, average daily rate (ADR) increased 1.9% to US$126.73, and revenue per available room (RevPAR) grew 1.6% to US$86.94. October marked the industry’s 80th consecutive month with a year-over-year increase in RevPAR.

“October produced the lowest RevPAR growth figure of any month since February of 2010,” said Jan Freitag, STR’s senior VP for lodging insights. “Opposite of last month, we expected results to be fairly weak with the Jewish holiday calendar shift (September 2015 to October 2016) having a pretty significant impact on Group demand. Halloween on a Monday instead of a Saturday (2015) also hurt performance.

“Another important item to note is supply growth. The 1.7% increase in rooms available was the highest since June 2010. Supply and demand each grew 1.5% through the first 10 months of the year, and while that will likely be the case through the end of the year, we are forecasting supply to pull ahead in 2017 and place further pressure on hoteliers’ pricing power.”

Among the Top 25 Markets, Norfolk/Virginia Beach, Virginia, registered the only double-digit increases in occupancy (+11.7% to 60.4%) and RevPAR (+14.8% to US$52.43). ADR in the market grew 2.8% year over year to US$86.79.

Minneapolis/St. Paul, Minnesota-Wisconsin, posted the largest rise in ADR (+8.3% to US$131.65) and ranked second in RevPAR growth (+7.6% to US$99.61).

Houston, Texas, reported the steepest declines across the three key performance metrics. Occupancy in the market dropped 12.8% to 63.2%, ADR was down 7.4% to US$104.69 and RevPAR fell 19.2% to US$66.17.

Miami/Hialeah, Florida, was the only other Top 25 Market to experience a double-digit decrease in any of the metrics. RevPAR in the market dropped 12.6% to US$106.92, driven primarily by an 8.4% decline in occupancy to 67.2%.

“The Top 25 Markets (RevPAR: -0.4%) lagged behind the performance of all other markets (RevPAR: +3.0%),” Freitag said. “That is not a surprise given that a significant portion of the country’s supply growth is happening in the major markets.”

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