U.S Hotel & Lodging Industry 2012 /13


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US Hotel & Lodging Industry 2012-13. Forecast by experts.

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U.S Hotel & Lodging Industry 2012 /13

  1. 1. A Sm@rtData Partner Pvt. Ltd. Compilation
  2. 2.  High demand from groups and business travelers will more than offset the effect of a weak economy. U.S. revenue per available room (RevPAR) will increase 7.2% this year on a 4.6% rise in room rates and a 1.5-point gain in occupancy. PwC in June forecasted a 6.5% RevPAR increase for 2012. High-end hotels are expected to continue to lead the advance, reflecting an economy in which larger businesses and wealthier leisure travelers appear to be less impacted by financial uncertainty. With occupancy surpassing recent prior peak levels in the luxury, upper-upscale and upscale segments, the lodging recovery is intact. PwC maintained its 2013 RevPAR growth forecast of 5.6%. By next year, PwC forecasts U.S. hotel occupancy will reach 61.9%, marking the fourth straight annual increase and the highest occupancy rate since it reached 62.8% in 2007. Inflation-adjusted average revenue per available room* of U.S. lodgings from 2001 to 2013 (in U.S. dollars)
  3. 3.  Inflation-adjusted average revenue per available room* of U.S. lodgings from 2001 to 2013 (in U.S. dollars)
  4. 4.  The hotel occupancy outlook for third quarter 2012 through second quarter 2013 is strong, with group committed room nights up 5.9 percent and transient room nights reserved up 7 percent based on current reservations and group commitments on the books in comparison to same time last year. The July NAHR looks at group sales commitments and individual reservations in 25 major North American markets booked by July 1, 2012 for July 2012 to June 2013. Committed occupancy for the third quarter of 2012 through the second quarter of 2013 (or the next 12 months) is up 6.1 percent in comparison to same time last year, with 20 of the top 25 North American markets showing increases in committed occupancy for this time period. Average daily rate is also growing, with an increase of 5.5 percent over the same time last year. The above information, coupled with detailed information on each of the next four quarters, verifies the outlook by most forecasting firms that suggests REVPAR increases of 5-10 percent over the next 12-18 months in the US.
  5. 5. • PKF-HR is projecting RevPAR for U.S. hotels will increase by 5.8 percent in 2012, and another 6.6 percent in 2013. The 2012 annual RevPAR growth forecast of 5.8 percent is the result of a projected 1.6 percent increase in occupancy and a 4.1 percent gain in average daily rate (ADR).• With demand growth forecast to continue to rise greater than supply in most cities over the next two years, 42 of the 50 markets are projected to exceed their long-run average occupancy levels by 2014.• The combination of efficient revenue growth and expense controls will result in attractive levels of hotel profit growth through 2016.• PKF-HR is projecting unit-level net operating income (NOI) growth to average 10 percent per year through 2016. This is superior to the long-run average NOI growth rate of 3.9 percent.• Luxury and upper-upscale properties achieved the greatest gains in RevPAR during the initial stages of the industry recovery; however, going forward, PKF-HR believes the greatest gains in annual performance will shift to the more moderate-priced segments. Capacity restraints and high ADRs at upper-tier hotels will force travelers to seek accommodation in the lower-tier properties.• The cities of Nashville, Houston, New Orleans and Salt Lake City are forecast to experience the greatest gains in demand in 2012. The early stages of the U.S. lodging industry recovery favored the large gateway markets. The return of demand to cities in the nations midsection is a sign that the recovery is expanding beyond the Atlantic and Pacific coasts
  6. 6. • In Q2, 2012, the U.S. hotel industry’s occupancy increased 3.1 percent to 65.1 percent, average daily rate rose 4.7 percent to $106.41 driving revenue per available room up 7.9 percent to $69.32. Source: Smith Travel Research 2010-2011, R. A. Rauch & Associates, Inc. 2012-2013.
  7. 7. • For 2012, the industry is expected to record a 2.1-percent increase in occupancy to 61.2 percent, an average-daily-rate gain of 4.4 percent to US$106.15 and a revenue-per- available-room increase of 6.5 percent to US$65.01.• Supply and demand are expected to end the year with increases of 0.5 percent and 2.6 percent, respectively.• Roomnight demand will stabilize with modest growth likely for the remainder of 2012 and into 2013.• In 2013, STR predicts occupancy to be virtually flat with a 0.3-percent increase to 61.4 percent, ADR to rise 4.6 percent to US$111.01 and RevPAR to grow 4.9 percent to US$68.17.• In 2013 supply (+1.4 percent) and demand (+2.0 percent) are both expected to report growth. Total United States performance forecast Supply Demand Occupancy % change ADR % change RevPAR % change 2012 +0.8% +1.3% 60.4% +0.5% $105.45 +3.8% $63.68 +4.3% 2013 +1.4% +2.0% 60.7% +0.5% $110.06 +4.4% $66.81 +4.9%
  8. 8. Note: This presentation has been compiled from various news articles and press releases by SmartData Partner Pvt. Ltd.
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