Amidst ongoing repercussions of the coronavirus (COVID-19) outbreak, the U.S. hotel industry continues to suffer. A statistical analysis from the week of March 8–14th reflects just how damning a challenge the virus is posing, with performance declines across all chain scales, classes, and location types.
According to STR, occupancy rates plummeted 24.4 percent to an even 53 percent overall. Average daily rate (ADR) declined 10.7 percent to $120.30, while Revenue per available room (RevPAR) dropped to $63.74, or 32.5 percent.
“To no surprise, the hurt continued and intensified for hotels around the country,” says Jan Freitag, STR’s senior vice president of lodging insights. “The performance declines were especially pronounced in hotels that cater to meetings and group business, which is a reflection of the latest batch of event cancellations and government guidance to restrict the size of gatherings.”
Each of the Top 25 markets reported a double-digit decline in occupancy and RevPAR. ADR was down across the board as well. Seattle saw the steepest drop in occupancy, ADR, and RevPAR, with declines of 55 percent, 24.7 percent, and 66.1 percent, respectively. The joint San Francisco and San Mateo, California region accounted for the second-steepest decreases in RevPAR. New York saw the third-largest drops in occupancy and RevPAR and New Orleans held third place for ADR decreases.
“The questions we are hearing the most right now are around how far occupancy will drop and how long this will last,” Freitag adds. “Through comparative analysis of the occupancy trends in China and Italy over the past weeks, we can—with certainty—say that we are not yet close to the bottom in the U.S. However, the timeline for that decline and the eventual recovery are much tougher to predict because there is still so much uncertainty around the COVID-19 case numbers in the U.S. and how serious citizens are when practicing social distancing. China and Italy saw a more abrupt decline in occupancy because of stricter lockdowns. That will dictate the speed of recovery.”
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