All in all the hospitality industry in the United States is performing remarkably well given that during the recent “great recession” it experienced some of its worst years since World War II. There are more than 4.9 million hotel rooms available in the U.S., according to STR. There is no question that guest room supply is abundant in this country and over building in the past has intermittently hindered industry operating performance. The good news is that due to the recent economic downturn there are fewer planned developments currently in the construction pipeline.

This factor coupled with recent growth in overall rooms demand has resulted in improved industry wide occupancy levels. As such occupancy levels are slowly recovering from the depths experienced during 2009 and 2010. The 2012 projected occupancy for the U.S. is expected to slightly exceed 61 percent which will reflect a substantial increase from the approximately 54.5 percent experienced in 2009 – the low point of the recent recession – yet still one to two points less than had been experienced in the years immediately preceding 2008. 314,395,000 $15.09 Trillion 1.7 % 2.2 % 4.9 Million 61.2% $106.15 $64.96 According to STR projections, average daily rates are also on the rebound with the projected 2012 ADR to be just over $106. Not quite back to pre-recession levels but well above the $98 average experienced in 2009. With new supply being held in check, the U.S. should see a rather sizeable improvement in ADR during 2013 as well. Currently the 2013 forecast for ADR is for it to exceed $111.

All of this contributes to an increase in the all important RevPAR metric which truly reflect the lifeblood of the industry. RevPAR for 2012 and 2013 are forecasted to increase some 6.5 percent and 5 percent respectively over the previous year levels. In any method of measurement the percentages and dollars reflected above truly do represent substantial increases to an improving hotel industry.

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James Chappell



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