While the main second-quarter performance metrics for the U.S. extended-stay lodging sector all declined year over year by record margins, the tier, especially its economy level, has weathered the pandemic more successfully than other parts of the U.S. lodging industry, according to a report released Monday by The Highland Group.
"The product's comparatively high share of longer-term, essentially residential guests and a large proportion of construction-related demand have cushioned the impact of the declines in transient and group travel," according to the report, referring to U.S. economy and lower midprice extended-stay tiers.
On the whole, second-quarter occupancy at U.S. extended-stay properties declined 37.2 percent year over year to 50.2 percent, according to The Highland Group, while average daily rate declined 29.4 percent to $75.48 and revenue per available room plummeted 55.6 percent to $37.90.
Still, the economy tier, comprised of brands including Choice Hotels' WoodSpring Suites and Red Roof's HomeTowne Studios, performed markedly better than the overall sector. Second-quarter occupancy and average daily rate, for example, declined 9.7 percent and 6 percent year over year, respectively, according to the report.
And the overall extended-stay tier results, while representing significant declines in occupancy and revenue, nevertheless have been stronger than those posted by the U.S. lodging industry as a whole.
"Extended-stay hotels' renewed focus on longer-term guests during this contractionary period has resulted in the widest differential between extended-stay and overall hotel occupancy we have ever reported," according to The Highland Group.
As of June 30, the supply of U.S. extended stay rooms totaled about 526,000, up 8.3 percent from one year prior, although not all of those rooms were open. Available room nights increased 5.7 percent year over year. About 53,300 rooms at the end of June were under construction, up 11.1 percent from one year prior.
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