Breaking Travel News

U.S. hotel perfomance slumps

The U.S. hotel industry posted declines across the board during the week of 18-24 January 2009, according to data from STR. However, Washington, D.C., enjoyed the benefits of President Barack Obama’s inauguration as the market’s performance was up markedly, which included year-over-year revenue per available room figures that more than doubled from 2008.In year-over-year measurements, the overall U.S. hotel industry’s occupancy rate fell 13.6 percent to end the week at 47.3 percent (54.7 percent in the comparable week in 2008). Average daily rate dropped 2.7 percent to finish the week at US$103.24 (US$106.15 in 2008). Revenue per available room for the week decreased 16.0 percent to finish at US$48.80 (US$58.07 in 2008).

Week-ending results for Washington were spectacular as expected. The inauguration events and festivities lifted the market’s occupancy levels by 16.1 percent to 61.2 percent (52.7 percent in 2008) and ADR improved 78.8 percent to US$260.52 (US$145.73 in 2008). The market’s RevPAR rose 107.6 percent to US$159.46 (US$76.82 in 2008).

“Unfortunately, there was little to no impact for the rest of the eastern seaboard and the remaining industry at large,” said Brad Garner, vice president of operations/client services at STR. “Nineteen of the Top 25 markets were met with double-digit declines in occupancy and continued softness in ADR.”

New York, typically a lodging industry and economic stalwart, led the Top 25 markets in both occupancy and ADR declines at -24.6 percent and -18.1 percent, respectively.

“While it could be argued that levels of performance in New York probably had the furthest to fall, the luxury stigma and sheer panic-based perceptions surrounding the U.S. economy have done the greatest harm to that market,” Garner said.


Five of the Top 25 markets experienced year-over-year occupancy declines of more than 20 percent: New York (-24.6 percent to finish the week at 55.8 percent); Atlanta, Georgia (-23.3 percent to finish at 46.2 percent); Detroit, Michigan (-22.8 percent to finish at 42.8 percent); Minneapolis-St. Paul, Minnesota
(-20.2 percent to finish at 45.1 percent)); and Chicago, Illinois (-20.1 percent to finish at 41.1 percent).

In addition to Washington, two of the Top 25 markets had ADR gains: New Orleans, Louisiana (+11.5 percent to US$131.06); and Denver, Colorado (+0.4 percent to US$100.01). Three of the Top 25 markets suffered double-digit ADR drops: New York (-18.1 percent to end at US$191.81); Miami-Hialeah, Florida (-11.2 percent to end at US$172.39); and Atlanta (-10.4 percent to US$89.59).

The Top 25 markets had an overall bad week in RevPAR performance, as 14 of them experienced RevPAR declines of more than 20 percent-including New York (-38.3 percent to US$107.11) and Atlanta (-31.2 percent to $US41.43).

All seven chain-scale segments were down across the board. The Luxury segment led the decline in two of the three major measurements as it was down 19.8 percent in occupancy to 55.0 percent and down 22.0 percent in RevPAR to $US149.98. The Independent segment’s 4.9-percent drop in ADR (to finish the week at $US97.09) led the declines in that category.

About STR & STR Global:
For more than 20 years, Smith Travel Research has been the recognized leader for lodging industry benchmarking and research. Smith Travel Research and STR Global offer monthly, weekly, and daily STAR benchmarking reports to more than 36,000 hotel clients, representing nearly 5 million rooms worldwide.  STR is headquartered in Hendersonville, Tennessee, and STR Global is based in London. For more information, visit