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STR: Wildfires alter hotel performance in Northern California

October 28, 2017 Hotel Trends No Comments Email Email

Recent Northern California wildfires caused significant hotel performance declines in Napa and Sonoma counties, while hotels in Mendocino and Solano counties saw a substantial performance lift, according to an analysis by STR’s Consulting and Analytics team.

For the purpose of its analysis, STR matched performance levels from the week of 1-7 October and 8-14 October with their respective comparable weeks in 2016.

“The September and October grape harvest is peak season in the area, and we saw two counties (Napa and Sonoma) that have historically maintained occupancy in excess of 80% in October each drop by double digits last week,” said Raquel Ortiz, STR’s senior analytics manager. “At the same time, hotels in the more residential counties (Mendocino and Solano) saw occupancy grow with business from displaced residents, firefighters, news crews, insurance adjusters and recovery workers.”

First week of October

County Occupancy ADR RevPAR
Napa 88.5% (+1.4%) $420 (+6.5%) $371 (+8.0%)
Sonoma 83.2% (-2.6%) $199 (+4.2%) $166 (+1.5%)
Mendocino 71.5% (0.0%) $108 (+2.6%) $78 (+2.6%)
Solano 79.7% (-3.6%) $104 (+7.2%) $83 (+3.4%)

All occupancy, average daily rate (ADR) and revenue per available room (RevPAR) % changes represent year-over-year comparisons. (Oct. 1-7 2017 vs. Oct. 2-8 2016). All financial figures in US$.

Second week of October

County Occupancy ADR RevPAR
Napa 72.1% (-18.9%) $263 (-33.9%) $190 (-46.4%)
Sonoma 76.0% (-10.2%) $177 (-5.6%) $134 (-15.3%)
Mendocino 84.0% (+27.3%) $116 (+11.1%) $97 (+41.5%)
Solano 85.2% (+6.1%) $105 (+8.1%) $90 (+14.7%)

All occupancy, average daily rate (ADR) and revenue per available room (RevPAR) % changes represent year-over-year comparisons. (Oct. 8-14 2017 vs. Oct. 9-15 2016). All financial figures in US$.

“While the one-week declines are noticeable, it might be some time before we see the full impact that these tragic wildfires will have on the region’s tourism industries,” Ortiz said. “While there is no direct comparison, we can form an idea of the hotel industry impact by looking at the Porter Ranch gas leak from a few years back. There were six straight months of double-digit RevPAR growth in the two submarkets of Los Angeles that were affected. We might expect something similar during the rebuilding process in Northern California.”

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