The US hotel industry sold more rooms than ever before on Friday and Saturday in 2019. labor day weekendsurpassing the record set in 2021.
The summer travel season ended strongly, benefiting from strong leisure demand, despite travel hassles, inflation and overall economic uncertainty.
During the 15-week summer travel season, US weekly room demand was the third highest since 2000, trailing only 2019 and 2018. Compared to 2019, demand he fell by 2.8%. Summer occupancy averaged 68.3%, down from 72.3% in 2019. Pre-pandemic summer occupancy averaged 69.5%.
Weekly performance bodes well for the fall travel season, especially as group demand for hotels continues to grow.
Airport screenings by the Transportation Security Administration show that Americans are flying at levels close to pre-pandemic levels, with a seven-day average as of Sept. 9 remaining within 5% of what it was so far in 2019.
U.S. hotel occupancy was 76% on Labor Day weekend Friday and Saturday, the highest in four weeks and in line with weekend occupancy achieved over the summer. Room demand (number of nights sold) was 1.2% higher than his 2019 counterpart for a record Labor Day weekend, according to data from CoStar’s hospitality analytics firm STR. All comparisons take into account calendar shifts for holidays.
However, room demand has been trending downward week by week, down 3.3% from the previous week. Weekly declines in demand are typical for this time of year, when summer turns to fall, but over the past few years demand has fallen more rapidly, averaging a 4.8% drop in the week before the Labor Day holiday. did.
US hotel occupancy for the full year was 62.8%, down 2.1% from the previous week but up 1.7% from the previous year.
Demand and capacity utilization plummeted ahead of the holiday weekend. From Sunday to Thursday, demand fell by more than 8% and occupancy fell by 5% week-on-week. The combined occupancy rate for weekdays and weekends was 57.6%, the lowest since Memorial Day week.
Nominal average daily rates were flat for the week and increased by 10% compared to the same week in 2021. Weekly nominal revenue per available room was down 3.4% for him week-over-week, but up 13.2% compared to 2021.
Adjusted for inflation, real ADR and RevPAR were negative, down 1% and 7%, respectively, compared to the same week of Labor Day Weekend 2019.
Nominal ADRs over the weekend rose 5.6% week-on-week, the biggest gain in 27 weeks. Weekly nominal RevPAR also performed well, with 94% of the market above his 2019 level, but this does not take into account the Labor Day holiday shift. After doing this and adjusting for inflation, a third of the market had a weekly RevPAR that was higher than in 2019. Looking specifically at holiday weekends, more than half of all hotels had real weekend RevPARs surpassing his 2019 Labor Day weekend.
25 US hotel markets hit record summer demand. These markets include Atlanta, Austin, Charlotte, Dallas, Miami and Nashville.
Demand was at record levels, but utilization was not. For example, Atlanta had his eighth-highest summer occupancy in 2022, Austin had his 12th-highest, and New York had his sixth-highest summer room demand, an occupancy rate in the last 23 years. He was ranked 18th. Not surprisingly, summer ADR and RevPAR were at their highest levels in 2022, but when inflation is taken into account they rank 4th respectively and he ranks 6th.
Market weekend occupancy ranges from 93% in Colorado Springs to 53% in Southern Louisiana, with most of the 166 markets defined by the STR exceeding 70%. A third of all markets reported over 80% occupancy on Friday and Saturday during Labor Day weekend.
New York City leads the top 25 markets with 92.6% weekend occupancy, boosted by the US Open. This was the highest weekend occupancy in the city since the pandemic began.
Weekend occupancy exceeded 80% in 12 of the top 25 markets, including Boston, Chicago, Denver and Los Angeles. For Chicago, it was the second highest weekend occupancy since March 2020. Another 11 of the top 25 markets reported over 70% but less than 80% weekend occupancy. Of the top 25 hotels, only the Houston and Phoenix hotel markets had occupancy below 70%. Overall, the top 25 markets had 79% weekend occupancy, the highest level since the end of July.
From Sunday to Thursday, only seven markets reported over 70% occupancy, including Boston with 75% and New York City with 77%. Denver was also close to that level with him at 69%.
Alaska had the highest weekly occupancy rate at 82%, followed closely by New York City at 81%. Hotels in Boston and Denver also had strong weeks, averaging 79% and 75% occupancy, respectively. San Francisco wasn’t at the top, but his occupancy rate was a solid 68%.
Ten of the top 25 markets have over 65% weekly occupancy, with New Orleans being an outlier at 46%. However, New Orleans’ weekend occupancy improved significantly to 72%, the highest in nine weeks, but well below the 84% achieved on Labor Day weekend in 2019.
Nominal weekend ADR increased by more than 20% in 17 US hotel markets. New Orleans was up 55% week-over-week. The New York City and Atlanta markets also reported strong week-on-week gains of over 25% in nominal ADRs.
At the property level, 103 hotels reported a weekend nominal ADR of $1,000 or more, up from 29 on Labor Day weekend in 2019. 59% of hotels that opened on Labor Day weekend in 2019 and are still open on Labor Day weekend reported real weekend ADR levels higher than in 2019.
Isaac Collazo is STR’s Vice President of Analytics.
This article represents an interpretation of data collected by STR, CoStar’s hospitality analytics firm. If you have any questions or concerns, please feel free to contact the editors. For further analysis of the STR data, Visit the Data Insights Blog on STR.com.
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