Hotel Data Show Rising Rates For Upper Tiers
July 21, 2010, 3:55 PMBy Michael B. BakerUpper hotel
tiers increased rates year over year in June, while lower tiers continued to
see rates fall, according to data released on Wednesday by Smith Travel
Research.
Overall for June, U.S. hotel occupancy climbed to 65 percent, up 6.9 percent
from its levels in June of 2009. Average daily rate increased by 1 percent, and
revenue per available room was up 8 percent.
"While this is certainly an encouraging sign, virtually all the increase
in room rates was found in upper-end hotels and those in New York City,"
STR president Mark Lomanno said in a statement. "The industry's recovery
will not be in full swing until room rate increases are seen in a much wider swath
of industry segments."
In the United States overall, luxury hotel rates were up 4.7 percent, the
largest increase among the tiers. Economy hotel rates, however, were down by
3.2 percent year over year, and midprice rates also were down slightly.
Occupancy, however, was up across all tiers as well as all of the top 25 U.S.
markets, according to STR. The largest occupancy increases were in Oahu and in
the Minneapolis area, both seeing increases of more than 15 percent.
Rates increased the most in New York, where they were up 15.4 percent compared
with June 2009. As a result, New York hotels saw a 22.5 percent increase in
RevPAR. Five other cities—Chicago, Minneapolis, Boston, Denver and Oahu—had
RevPAR increases of more than 15 percent.
New Orleans had the largest drops in rates and RevPAR, down by 9.2 percent and
1.6 percent, respectively.