Third-quarter performance for U.S. extended-stay hotels set 14 new records for metrics including demand, occupancy, average daily rate and revenue per available room, according to the latest quarterly report from The Highland Group. Additionally, in year-to-date metrics through Sept. 30, economy extended-stay hotels set four new records, midprice reported two and the upscale segment set a new high for demand.
"It is highly likely that extended-stay hotels will continue to set new performance records during the near term," said The Highland Group partner Mark Skinner in a statement.
Third-quarter U.S. extended-stay hotel room-night demand was 40,431, representing a 25.7 percent year-over-year increase and the highest gain in demand ever reported during any quarter for the segment, according to the report. Supply growth, with various hotel closures and re-openings due to the effects of the pandemic, was 6.3 percent during the same period, consistent with what was seen prior to the pandemic.
The overall U.S. extended-stay occupancy level was 78.8 percent for the quarter, an 18.2 percent year-over-year increase. The economy tier reported the highest occupancy level at 83.3 percent, followed by midprice at 78.5 percent. Both figures were third-quarter records for their tiers and represent full recovery to 2019 third-quarter occupancy levels. Occupancy in the upscale tier, however, which accounts for about 40 percent of extended-stay room supply, was 77.2 percent. Though lower than the other tiers, the number represents a 30 percent year-over-year increase.
Economy and midprice ADRs have surpassed 2019 levels and set new third-quarter records. Upscale-tier ADR increased 22.4 percent from its 2020 level but still is about $9 lower than its 2019 level. The overall U.S. extended-stay segment's ADR was $104.96 for the quarter, about 98 percent of the 2019 third-quarter rate.
Third-quarter RevPAR was up 48.5 percent year over year to $82.76. All three tiers showed significant year-over-year improvement, with economy and midprice RevPAR above 2019 third-quarter levels. Upscale RevPAR improved 59.1 percent year over year to $106.18, representing about 89 percent of 2019's third-quarter level.
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