Hotels see slight improvement in revenues, occupancy

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Casting about for some good news, we find that the hotel industry is doing ‘less worse’ than it was earlier this year, according to Smith Travel Research. Hotel revenues and occupancy are still way below what they were about this time in 2008, but they’re slightly better than they were in February and March.

The hospitality industry measures success by calculating revenue per available room – RevPAR, they call it – by multiplying the occupancy rate of a hotel by the average daily room rate. By that measure, RevPAR for the week ending April 25 was down 19.1% from a year ago nationwide. That was much worse than the 14.1% dip reported the week before, but that week was helped by the timing of Passover, which occurred on a different week in 2008.

‘Although 19% is still far from signaling an amelioration of any sort in the lodging industry trends, we do note that compared with the very low levels seen in February and mid-March of this year, when RevPAR was consistently down in the early to mid-20% range, last week’s results are better,’ the report said.

Smith Travel attributed the modest improvement in hotel performance to positive economic news such as the recent run-up in the stock market and some commentary from pundits saying the economy may be stabilizing. Such news is ‘feeding the positive consumer sentiment that things may be getting ‘less worse,’ ‘ the report said.

-- Roger Vincent