PricewaterhouseCoopers today updated its U.S. lodging forecast to call for continued decreases in rates and revenue per available room in 2010 but a slight increase in occupancy.
Despite projected economic growth throughout the rest of this year, PwC said RevPAR for the full year 2009 will drop by 16.1 percent, and average daily rate will decline by 8.7 percent compared with 2008. These drops are slightly lower than the declines reiterated by Smith Travel Research on Wednesday
(BTNonline, Sept. 9), but are slightly higher than what PwC issued in a June forecast.
"Although recent levels of room night demand have been more favorable, the demand environment during the second half of 2009 is expected to remain challenging," Scott Berman, PwC principal and U.S. industry leader for hospitality and leisure, said in a statement. "This, coupled with a difficult rate environment, is expected to compress RevPAR levels for the rest of 2009. In 2010, although demand is expected to start growing again, hotels are expected to face continuing pricing pressures."
PwC projects that occupancy in 2010 will increase by 1.1 percentage points to 56.1 percent, though still well below the more than 60 percent rates seen in the past several years.
Rates and RevPAR, meanwhile, should still decrease but stabilize in 2010, according to PwC. The firm projects a 0.1 percent decrease in RevPAR and a 1.1 percent decrease in average daily rate compared with this. This forecast also is down from PwC's June prediction of nearly flat average daily rates in 2010 and a slight increase in RevPAR.