STR and Tourism Economics once again have downgraded their
2019 and 2020 U.S. revenue per available room forecasts, in what is their final
forecast revision of this year. Today, the companies project 2019 and 2020 year-over-year
RevPAR growth figures to be 0.8 percent and 0.5 percent, respectively.
The 2019 projection at the start of the year was for 2
percent growth, before the first
downgrade in late January to 1.9 percent. At that time, 2020 RevPAR growth
was forecast to be 1.7 percent. The companies released additional downgrades in
June
and August.
The latter guidance was year-over-year RevPAR growth of 1.6 percent for 2019
and 1.1 percent for 2020.
"U.S. hotels have posted nine straight years with
RevPAR increases of basically 3 percent or higher, so growth levels below 1
percent will clearly represent the industry's worst years since the recession,"
said STR president Amanda Hite.
Average daily rate continues to be the main driver behind
any growth in RevPAR as the companies forecast occupancy to decline 0.2 percent
year over year in 2019 and 0.4 percent in 2020. Still, ADR growth has slowed
and was downgraded from 1.4 percent growth in each year to an anticipated 1
percent increase in 2019 to $131.29 and 0.9 percent increase in 2020 to
$132.50.
Of the top 25 markets, the companies expect 14 to report
RevPAR declines in 2019, with the steepest drops projected for Seattle and New
York City. For the other 11, four are expected to post RevPAR growth of 3
percent or higher: Atlanta, Denver, Phoenix and San Francisco/San Mateo.
Among chain segments, three are projected to report 2019 RevPAR
declines: Upscale (0.4 percent), Upper Midscale (0.2 percent) and Midscale (0.4
percent). These three segments also show the most supply growth in 2019.
2020 looks better, as the companies project 19 of the top 25
markets to see a RevPAR increase, led by Miami. New York is expected to continue
to struggle, projected to report the steepest decline in the metric.
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Downgrade U.S. Hotel Performance Projections