Friday, September 11, 2015

Hotels: On Pace for Record Occupancy in 2015

by Bill McBride on 9/11/2015 11:41:00 AM

Note: Some of the year-over-year improvement last week was due to the shift in timing of Labor Day.

From HotelNewsNow.com: STR: US results for week ending 5 September

The U.S. hotel industry recorded positive results in the three key performance measurements during the week of 30 August through 5 September 2015, according to data from STR, Inc.

In year-over-year measurements, the industry’s occupancy increased 7.5% to 63.6%. Average daily rate for the week was up 6.6% to US$115.73. Revenue per available room increased 14.6% to finish the week at US$73.58.
emphasis added
The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.  The occupancy rate is now declining following the summer travel season.

Hotel Occupancy RateThe red line is for 2015, dashed orange is 2014, blue is the median, and black is for 2009 - the worst year since the Great Depression for hotels.  Purple is for 2000.

Special Note: I added 2001 (yellow) to show the impact of 9/11/2001 on hotel occupancy.  Occupancy was already down in 2001 due to the recession, and really collapsed following 9/11.

For 2015, the 4-week average of the occupancy rate is solidly above the median for 2000-2007, and above last year.

Right now 2015 is above 2000 (best year for hotels), and 2015 will probably be the best year ever for hotels.

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