Thursday, May 14, 2009

Hotel Recession Reaches 18 months, RevPAR off 22.4%

by Calculated Risk on 5/14/2009 01:36:00 PM

From HotelNewsNow: Hotel industry enters 18th month of recession

Economic research firm e-forecasting.com in conjunction with Smith Travel Research announced that following a decline of 3.7 percent in March, HIP went down 1.1 percent in April. HIP, the Hotel Industry's Pulse index, is a composite indicator that gauges business activity in the U.S. hotel industry in real-time. The latest decrease brought the index to a reading of 84.2.
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“With April’s reading of HIP, the hotel industry is creeping up to the weak performance of the industry during the recession in 1981-1982, which lasted 20 months. Even still, there is some promise in April’s reading as it appears the decline may have hit a bottom, looking at the six-month growth rate and monthly decline,” noted Evangelos Simos, chief economist of e-forecasting.com.
See article for graph of HPI.

Also from HotelNewsNow.com: STR reports US hotel performance for week ending 9 May 2009
In year-over-year measurements, the industry’s occupancy fell 14.0 percent to end the week at 53.6 percent. Average daily rate dropped 9.8 percent to finish the week at US$97.58. Revenue per available room for the week decreased 22.4 percent to finish at US$52.32.
Hotel Occupancy Rate Click on graph for larger image in new window.

This graph shows the YoY change in the occupancy rate (3 week trailing average).

The three week average is off 12.1% from the same period in 2008. The comparable week off 14.0%.

The average daily rate is down 9.8%, so RevPAR is off 22.4% from the same week last year.

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