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Thursday, September 03, 2020

Hotels: Occupancy Rate Declined 27.7% Year-over-year

by Calculated Risk on 9/03/2020 12:29:00 PM

From STR: US hotel results for week ending 29 August

U.S. hotel occupancy decreased slightly for the second consecutive week, according to the latest data from STR.

23-29 August 2020 (percentage change from comparable week in 2019):

Occupancy: 48.2% (-27.7%)
• Average daily rate (ADR): US$98.39 (-23.2%)
• Revenue per available room (RevPAR): US$47.38 (-44.5%)

The industry sold 237,000 fewer room nights than the previous week, which represented a demand decrease of 1.3%. Week-over-week demand improvements were a constant since mid-April, but as summer ends and leisure travel fades, hotel performance gains have flattened.
emphasis added
The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.

Hotel Occupancy RateClick on graph for larger image.

The red line is for 2020, dash light blue is 2019, blue is the median, and black is for 2009 (the worst year probably since the Great Depression for hotels).

The leisure travel season usually peaks at the beginning of August, and then the occupancy rate typically declines sharply in the Fall.  So "flat" isn't terrible.

With so many schools closed, the leisure travel season might have lasted longer than usual this year, but it is unlikely business travel will pickup significantly in the Fall.

Note: Y-axis doesn't start at zero to better show the seasonal change.