First-quarter U.S. extended-stay hotel demand declined 7.1 percent year over year to 29.2 million room nights, the largest such quarterly drop ever reported, according to The Highland Group. The midprice and upscale extended-stay tiers were hurt the worst, with 6 percent and 11.8 percent declines, respectively. Still, the overall demand drop compares favorably with all hotels, which declined 14.2 percent in the first quarter.
U.S. extended-stay occupancy dropped 9.8 percent year over year to 65.8 percent, again with the upscale segment reporting the steepest decline at 14.6 percent. Absolute occupancy for all U.S. hotels for the quarter was 51.8 percent, according to STR and The Highland Group. The extended-stay hotel occupancy level for the first quarter is the lowest for any quarter since the fourth quarter of 2009.
Quarterly extended-stay revenue per available room dropped 14.6 percent year over year to $63.45. The decline was less than the 19.3 percent decline for the overall U.S. hotel industry. Average daily rate declined 5.3 percent for the quarter, compared with a 4 percent decline in the overall hotel industry. However, the economy extended-stay segment reported a 1.3 percent increase to $46.44, and upscale declined only 3.2 percent to $96.38.
U.S. extended-stay hotel room closures because of the coronavirus pandemic is at more than 25,000, which accounts for about 5 percent of the segment's room supply, according to The Highland Group.
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