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Enterprise, Group Journey Propel Weekly US Lodge Efficiency

Whereas every week doesn’t make a development and the street to restoration for enterprise and group journey will doubtless have many ups and downs, the newest weekly efficiency information from STR exhibits that demand for motels is coming again, significantly within the US high 25 markets, the place its absence has been very obvious.

The subsequent a number of weeks will doubtless trigger some anxiousness amongst hoteliers round these demand segments, nevertheless it’s all predictable. Observances of the Jewish holidays Rosh Hashanah and Yom Kippur are anticipated to have a adverse impact on enterprise and group journey, and leisure journey demand will likely be aided by US faculty breaks, such because the observance of Columbus/Indigenous Peoples’ Day.

After a number of consecutive week-over-week declines, typical for this time of 12 months because the journey season transitions from summer season to fall, US lodge demand soared again for the week endingSep. 17. In comparison with the earlier week, demand was up 13%, whereas occupancy reached a six-week excessive of 69.6%.

Weekday occupancy was barely higher at 69.9%, and that metric was even higher within the high 25 markets at 75.5%. Weekday high 25 market lodge occupancy has solely been larger one different time since March 2020 — within the week of June 18, 2022.

Nominal common every day price reached a seven-week excessive of $156, up 5.8% week over week and 18% 12 months over 12 months. Actual ADR, adjusted for inflation, was equal to what it was in the identical week of 2019. After three weeks under $100, nominal income per out there room jumped to $108, 19.4% better than every week in the past and 31% larger than in the identical week final 12 months. Actual RevPAR was slightly below 2019’s worth.

Over the previous 22 years, US lodge demand for the primary full week after the Labor Day vacation has elevated on common by 14.5%.

This 12 months within the week ending Sept. 17, demand was up 13%, on the decrease finish of the vary seen since 2000. The US lodge business offered 27.2 million room nights, probably the most ever for a full week after Labor Day. Nonetheless, as a result of calendar shift within the vacation, it was not the best demand for the thirty eighth week of the 12 months. That document was set in 2019, two weeks after the Labor Day vacation, when the business offered 8,000 extra room nights than this 12 months.

Enterprise and group journey contributed probably the most to the robust development in weekday demand.

Weekday demand was the seventh highest because the begin of the pandemic. The earlier six pandemic-era highs had been all achieved in the course of the 2022 summer season season when leisure vacationers had been additionally filling lodge rooms. Excluding the prime summer season journey months of June and July, weekday demand was the best because the begin of the pandemic and the fifteenth highest of all time going again to 2000.

The US high 25 lodge markets benefited probably the most from the return of enterprise and group vacationers.

Weekday occupancy topped 70% in 18 of the markets with six — Boston, Chicago, Denver, New York, San Francisco and Seattle — surpassing 80%. Seattle and New York led the highest 25, each topping 90% occupancy for the week.

Chicago, New York and Seattle lodge markets had their highest weekday demand because the begin of the pandemic. Philadelphia additionally set a pandemic-era document for demand with weekday occupancy at 69%.

4 markets — Houston, Miami, New Orleans and Tampa — had been laggards with weekday occupancy within the low-60% vary. September is often the bottom occupancy month for Miami and Tampa, so that’s not a shock, however Houston and New Orleans occupancy tends to go up presently of 12 months.

Central enterprise district weekday lodge demand and occupancy (79%) was additionally the best its been because the begin of the pandemic period. Weekday occupancy surpassed 90% in 4 central enterprise districts — Boston, Chicago, New York Monetary District and Seattle. New Orleans had the bottom weekday occupancy of the central enterprise districts at 47%. All different central enterprise districts reported weekday occupancy above 65%, and most had been above 70%. Full-week demand and occupancy for the central enterprise districts was 76%, additionally the best of the pandemic period.

Weekday group demand was additionally the best its been since March 2020, as luxurious and upper-upscale motels offered greater than 1.1 million room nights in the course of the week.

Complete group demand, all chain scales and lessons, accounted for greater than a 3rd of the acquire in weekday demand and made up 16% of the business’s whole weekday demand.

Weekday occupancy was within the mid-70% vary within the predominantly business-oriented chain scales — together with upper-upscale, upscale and upper-midscale — led by upper-upscale motels at 79%. Not stunning, upper-upscale lodge demand was the best its been because the begin of the pandemic. Greater than half of the weekday demand acquire by upper-upscale motels got here from elevated group demand. Full-week occupancy surpassed 70% in 4 of the seven chain scales, led by luxurious at 73%.

Weekend efficiency additionally returned from its post-summer doldrums with occupancy of 77%. Weekend occupancy was barely larger within the high 25 markets at 78%, with half of the markets reporting occupancy above 80% and all however two above 70%. The very best weekend occupancy amongst all submarkets was in Gatlinburg and Pigeon Forge in Tennessee, each at 95%.

Weekly actual ADR, adjusted for inflation, elevated to $135, which was barely higher than within the comparable week of 2019. Weekly high 25 market nominal ADR achieved a pandemic-era excessive of $189, as did actual ADR at $164, reaching its highest stage because the first week of December 2019. Weekday nominal ADR within the high 25 markets was even larger at $195 and was the third highest in historical past. Precise weekday ADR topped $169.

With the soar in demand and the continued surge in ADR, nominal RevPAR was above 2019 ranges in almost each market in the course of the week. Half of all markets had weekly Actual RevPAR above 2019 together with Chicago, Miami, Orlando, San Diego and Phoenix. Among the many high 25 markets, Orlando led in comparisons to 2019, with weekday actual RevPAR 19% larger.

Within the 28 days ending Sept. 17, 43% of the 166 STR-defined markets had actual RevPAR above 2019. Solely two markets, San Jose and San Francisco, had been nonetheless categorized as being in “recession,” as actual RevPAR was lower than 80% of what it was in 2019.

Isaac Collazo is VP Analytics at STR.

This text represents an interpretation of information collected by CoStar’s hospitality analytics agency, STR. Please be happy to contact an editor with any questions or considerations. For extra evaluation of STR information, go to the information insights weblog on

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