The hospitality industry has been given a welcome boost as Marriott International confirmed the first increase in room rates at its North American properties for almost two years.
Rates at properties owned by the company increased one per cent during the month of May when compared to the period a year ago, suggesting the benighted industry may have turned a corner.
Revenue per available room – RevPAR – also increased by nine per cent during the period.
Speaking to a lodging conference in New York, Arne Sorenson, Marriott’s president and chief operating officer, reported in the second quarter – which runs from March 27th to June 18th - RevPAR was up 7.3 per cent compared to the previous year.
[stock]Mar|1m|right|Marriott leads industry out of slump[/stock]
However, rates were flat compared with the same period a year ago, suggesting the upturn is a relatively recent trend.
Beyond the immediate business climate, Mr Sorenson pointed to brand strength, growth of emerging markets, technology advances and the expansion of leisure travel as four trends he said “portend excellent opportunities for the lodging business”.
The Marriott president also added he was “wildly optimistic” about prospects for growth in the North American business travel sector.
Following an industry wide RevPAR slump of an unprecedented 16.7 per cent there is now a growing sense of optimism in the North American accommodation industry.
Marriott shares rose 3.4 per cent to $32.14 on the New York Stock Exchange following the announcement.