STR Reports U.S. Hotel Performance for March 2009

Vacation News » Vacation & Leisure Real Estate Edition | By Michael Gerrity | April 24, 2009 11:01 AM ET

(News Source: Smith Travel Research)

(HENDERSONVILLE, TN) -- The U.S. hotel industry posted declines in all three key performance measurements during March 2009, according to data from STR.

In year-over-year measurements, the industry's occupancy in March fell 11.6 percent to end the month at 55.2 percent (62.5 percent in March 2008). Average daily rate dropped 9.6 percent to finish the month at US$99.42 (US$109.97 in March 2008). Revenue per available room for the month decreased 20.0 percent to finish at US$54.93 (US$68.69 in March 2008).

"Performance results for March continue to show sharp drops in the key measures of occupancy and ADR," said Mark Lomanno, president of STR. "However, we have begun to believe that the industry may have bottomed out from a demand perspective. Over the past two months, the number of rooms sold has remained fairly consistent after the accelerating drops experienced beginning in September 2008 through January 2009. Knowing that the trough in the cycle has been reached gives hope that the beginnings of a modest recovery may not be far away."

During March, none of the Top 25 Markets reported increases in any of the three key performance measurements. In occupancy, only six of the markets ended the month with single-digit decreases. Orlando, Florida, reported the largest decrease in occupancy, which was down 17.9 percent to 67.2 percent.

Three other markets reported occupancy decreases of more than 15 percent, including Detroit, Michigan (-17.1 percent to 45.0 percent); New Orleans, Louisiana (-16.8 percent to 62.9 percent); and San Diego, California (-15.6 percent to 61.9 percent).

The largest decrease in ADR was reported by New York, New York, which experienced a 24.4-percent drop to US$193.19. Miami-Hialeah, Florida (-18.2 percent to US$170.93) and Phoenix, Arizona (-15.4 percent to US$133.23) also reported large decreases in ADR. Six markets reported RevPAR decreases of more than 25 percent: New York (-35.5 percent to US$135.99); Miami-Hialeah (-28.5 percent to US$126.80); Orlando (-27.9 percent to US$71.28); Detroit (-25.4 percent to US$35.08); San Diego (-25.4 percent to US$76.49); and Chicago, Illinois (-25.1 percent to US$55.24).

For the first quarter of 2009, the U.S. hotel industry experienced declines in all three key performance metrics when compared to first quarter 2008. Occupancy was down 10.9 percent to 51.4 percent (57.7 percent in 2008). ADR decreased 7.7 percent to US$100.13 (US$108.46 in 2008). RevPAR dropped 17.7 percent, ending the quarter at US$51.44 (US$62.54 in 2008).

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