Positive results for U.S. hotel industry in January

Published on : Tuesday, February 23, 2016

STR-logoThe U.S. hotel industry reported positive results in two of the three key performance metrics during January 2016, according to data from STR, Inc.

 

 

 

In year-over-year results, the U.S. hotel industry’s occupancy remained nearly flat (-0.3% to 54.0%). However, average daily rate for the month was up 2.8% to US$116.61, and revenue per available room increased 2.4% to US$63.01.

 

 

“This is the lowest January RevPAR performance since 2010 (-7.7%) and just a poor showing all round,” said Jan Freitag, STR’s senior VP for lodging insights. “The long run January average is +3.2%, and the average for January between 2011 and 2015 was +7.8%. Growth rates of more than 5% are probably not sustainable in the long run, but a bit more growth to open the year would have been nice.”

 

 

Freitag also noted that occupancy declined for just the third time in the last 72 months. However, despite the lack of significant growth in January, RevPAR has increased in year-over-year comparisons for 71 consecutive months.

 

 

Among the Top 25 Markets, Los Angeles/Long Beach, California, reported the largest increases in each of the three key performance metrics. Occupancy in the market rose 6.1% to 75.9%; ADR was up 8.8% to US$162.31; and RevPAR grew 15.5% to US$123.11.

 

 

Two additional markets reported a double-digit lift in RevPAR: Nashville, Tennessee (+10.9% to US$67.40), and San Francisco/San Mateo, California (+10.2% to US$176.91).

 

 

Phoenix, Arizona, host of the Super Bowl in 2015, reported the month’s only double-digit decreases in ADR (-10.8% to US$140.96) and RevPAR (-11.2% to US$98.71). Occupancy in the market remained steady (-0.4% to 70.0%).

 

 

The largest occupancy decline amongst the Top 25 Markets was experienced in New Orleans, Louisiana (-8.1% to 59.0%).

 

 

“Just like in December, RevPAR growth in the Top 25 Markets (+2.2%) was actually worse than the rest of the U.S. (+2.6%),” Freitag said. “That said, occupancy in the Top 25 Markets held and dropped 0.6% elsewhere. That implies a little more pricing power in other markets. In the larger markets, ADR growth was basically driven by group ADR since Transient ADR was flat. Group occupancy was hit hard, probably because of Winter Storm Jonas.”
Source: STR.

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