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U.S. hotel industry reported positive results in May 2017

Staff Writer |
The U.S. hotel industry reported positive results in the three key performance metrics during May 2017, according to data from STR.

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In a year-over-year comparison with May 2016, the industry reporte occupancy: +1.5% to 67.8%, average daily rate (ADR): +2.0% to $126.63, and revenue per available room (RevPAR): +3.6% to $85.85.

“The industry sold more roomnights (nearly 108 million) and reached the highest occupancy level for any May on record,” said Jan Freitag, STR’s senior VP of lodging insights.

“At the same time, the ADR growth rate was the second-lowest of 2017 and well below the historical average for May (+3.0%).

“Clearly, supply growth hovering close to 2% is making hoteliers less confident in their pricing power, even when occupancy performance is positive.

“Moving forward, we are projecting supply growth to surpass demand growth, leading to flattening then decreasing occupancy. That will leave ADR as the lone driver of RevPAR growth.”

RevPAR has now grown year over year for 87 consecutive months in the U.S.

Three Top 25 Markets posted double-digit growth in RevPAR for the month: Seattle, Washington (+11.3% to $134.67); Boston, Massachusetts (+11.2% to $181.96); and Orlando, Florida (+10.7% to $90.36).

Boston’s RevPAR growth was driven by the top ADR increase (+8.0% to $223.63) of the month.

Denver, Colorado, saw the largest increase in occupancy (+5.9% to 81.4%).

Houston, Texas, experienced the largest RevPAR decrease (-8.7% to $67.66).

San Francisco/San Mateo, California, reported the steepest decline in ADR (-6.2% to $217.88). Dallas, Texas, reported the largest drop in occupancy (-3.9% to 70.5%).

“RevPAR growth in the Top 25 Markets (+1.9%) was significantly lower than in all other markets (+4.7%), but once again, that’s to be expected with the rapid rate of supply growth in the larger markets.”

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