U.S. Lodging Supply Growth Continues To Contract Much More Slowly As the Lodging Industry Emerges from the 2001 Recession, Than Following the 1990-1991 Recession. Less Dramatic Occupancy Gains Will Occur in Next Two Years as a Result
Lodging supply growth has slowed more gradually following the 2001 recession, than it did following the 1990-1991 recession. The higher rate of supply growth will result in less dramatic occupancy gains in 2004 to 2006 compared with the period following 1990-1991 recession.
It will be seven years by the time supply growth moves from peak to trough during the current economic cycle. It took only five years for supply growth to move from peak to trough during the 1990-1991 downturn.
Prior to the current recession lodging supply peaked in 1997 at 145,000 room completions at 3.9 percent growth rate. Supply growth will trough in 2004 at 58,000 room completions at 1.3 percent growth rate.
According to Smith Travel Research, prior to the last recession, lodging supply completions peaked in 1987 at 165,000 room completions at 5.1 percent growth rate. Lodging supply completions troughed in 1992 at 28,000 room completions at 0.7 percent growth rate.