Thursday, October 15, 2009

Hotel RevPAR off 12 Percent

by Bill McBride on 10/15/2009 01:21:00 PM

From New Orleans leads increases in STR weekly numbers

Overall, in year-over-year measurements, the industry’s occupancy fell 5.4 percent to end the week at 59.8 percent. ADR dropped 7.0 percent to finish the week at US$99.21. RevPAR for the week decreased 12.0 percent to finish at US$59.28.
Hotel Occupancy Rate Click on graph for larger image in new window.

This graph shows the occupancy rate by week for each of the last four year (2006 through 2009 labeled by start of month).

This shows the distinct seasonal pattern, with occupancy higher in the summer (because of leisure travel), and lower on certain holidays. This also shows that hotels are in two year occupancy slump. The year-over-year comparisons are easier now since business travel fell off a cliff last October. Comparing to the same week two years ago, occupancy rates are off over 12%.

Notes: the scale doesn't start at zero to better show the change. Data Source: Smith Travel Research, Courtesy of Thanksgiving was late in 2008, so the dip doesn't line up with the previous years.

And more on business travel:

First, from MarketWatch on business travel: Southwest Airlines CEO: the worst is not behind us
Chief Executive Gary Kelly said Thursday that the worst was not yet behind the low-cost carrier because of higher energy prices and the lack of business travel.
“We have significant demand at our discounted pricing levels. We have very weak demand at our full-fare levels.”
Southwest Airlines CEO Gary Kelly, Oct 15, 2009