Thursday, August 12, 2010

Hotel Occupancy Rate at 70% last week

by Bill McBride on 8/12/2010 01:02:00 PM

Hotel occupancy is one of several industry specific indicators I follow ...

From HotelNewsNow.com: STR: Economy segment leads weekly occupancy gains

Overall, the industry’s occupancy increased 6.7% to 70.2%, average daily rate rose 1.6% to US$99.13, and revenue per available room increased 8.4% to US$69.57.
The following graph shows the four week moving average for the occupancy rate by week for 2008, 2009 and 2010 (and a median for 2000 through 2007).

Hotel Occupancy Rate Click on graph for larger image in new window.

Notes: the scale doesn't start at zero to better show the change. The graph shows the 4-week average, not the weekly occupancy rate.

On a 4-week basis, occupancy is up 6.9% compared to last year (the worst year since the Great Depression) and 4.0% below the median for 2000 through 2007.

Just over half way back to normal, and almost back to the levels of 2008 (the occupancy rate started to fall off in the 2nd half of 2008).

NOTE: The supply of rooms in the survey is up just over 2% from last year. The increase in the occupancy rate is from an increase in demand - although this is still fairly weak (the 2nd half of 2008 was weak for hotels).

Data Source: Smith Travel Research, Courtesy of HotelNewsNow.com