New York City Momentum, Strong ADR Around the U.S. Highlight Continued Performance Recovery – STR
New York City momentum, strong ADR around the U.S. highlight continued performance recovery
Robust top-line hotel performance indicators for the four weeks ending 11 June point to a clean transition between a rock-solid recovery during the spring to summer’s traditionally leisure-heavy travel period. With domestic leisure travel expected to remain strong, along with a recent lifting of international travel restrictions, STR expects a record-breaking summer season with numerous U.S. hotel markets to surpass 2019 comparables.
Largely on the strength of average daily rate (ADR), 142 of 165 (86%) STR-defined U.S. markets posted a four-week index in revenue per available room (RevPAR) that was above the matched 2019 period. Further, all but four U.S. markets recently had nominal (non-inflation adjusted) average rates that exceeded 2019 levels. Almost 100 U.S. markets reported average rates that were 15% or higher than 2019 levels. In contrast, 43 markets showed four-week average occupancy that matched or exceeded 2019 levels. Two-thirds of those 123 markets that fell short on occupancy, however, missed their 2019 period marks by a relatively narrow margin of five percentage points or less.
The Top 25 Markets have recently shown a more blended recovery in both occupancy and ADR over recent weeks. New York City led all U.S. markets in average occupancy for the period at 83.1%—a jump of 6.6 percentage points since our May update. The next markets on the Top 25 occupancy leaderboard were well below that level, including Boston (76.8%, a 6.7pp monthly gain), and Seattle (76.4%, up 7.7pp). Room pricing power increased because of those markets’ occupancy gains. NYC’s monthly ADR increased US$25 month over month to US$305, which was a 15% increase over 2019 ADR levels. Boston’s ADR rose US$32 to US$246, while Seattle saw a 15% ADR increase to US$176. On the lower end of larger markets, there was an expected seasonal transition with several warm climate destinations, such as Houston, New Orleans and Phoenix, moving into a slower seasonal RevPAR pattern.
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Categories: Trends