Hotels Bookings, Openings Grow
Hotels experienced steady bookings increases in late 2015, with 21 of the top 25 markets showing committed occupancy growth, reported TravelClick, New York.
“The new reservation growth in the final month of this year is welcomed news for hoteliers across North America,” said TravelClick Senior Industry Analyst John Hach. “The overall reservation trend is positive, especially given recent headlines and concern over terrorism, showing that North America continues to be a strong market.”
In recent months hotels have relied mostly on increasing average daily room rates rather than on increasing occupancy to achieve revenue per available room growth, TravelClick reported. “As ADR continues to be the key driver of RevPAR growth, we foresee this trend continuing, making it increasingly important for hoteliers to leverage advance booking business intelligence solutions to actively manage unanticipated local market developments,” Hach said.
Hach said the hotel sector ended 2015 on a resilient note, “and this is carrying over into 2016; thus, there will continue to be viable opportunities for hoteliers to increase revenue and capitalize on the strength of the North American market.” But he noted that growth areas are becoming increasingly localized and suggested that hotel owners closely monitor key nearby hotels and emerging alternative lodging competitors such as Airbnb before opening a new property.
CBRE Research, Los Angeles, reported that national hotel room supply grew by more than one percent in both the third and fourth quarters–a first in this cycle. “Although this is concerning, the rate is well below the annualized long-run average” of 1.9 percent, CBRE said. “Throughout most of the country, demand continues to outpace supply and new construction is not yet a cause for alarm. With rising room rates and record occupancy levels, many developers are finally able to get financing and many more projects are either beginning construction or reaching the final planning phase in the development pipeline.”
Lodging Econometrics, Portsmouth, N.H., agreed that hotel openings should accelerate over the next two years. Based on the current construction pipeline, 845 hotels will open this year and 998 in 2017, the firm said. Three major franchise companies, Marriott International, Hilton Worldwide and Intercontinental Hotels Group, will brand two-thirds of the new properties, LE said. Marriott International will lead with 456 hotel openings followed by Hilton Worldwide with 406 and IHG with 374.
