By Tammy Messing
HENDERSONVILLE, Tennessee—The U.S. hotel industry reported positive results in the three key performance metrics during October, according to data from STR
, parent company of Hotel News Now.
Overall, the U.S. hotel industry’s occupancy slightly rose 0.8% to 64.7%; its average daily rate was up 3.3% to $113.48; and its revenue per available room increased 4.1% to $73.48.
“Room demand in October increased by only 1.5% to 98.6 million rooms sold, well below the 2.1% year-to-date average,” said Jan Freitag, senior VP at STR. “Two reasons for the demand softness were likely the government shutdown between 1 October and 16 October, and Hurricane Sandy made landfall at the end of October 2012. In addition, demand comparables on the East Coast were probably tougher.”
Group ADR increased 3.1%, and transient ADR increased 3.5%, Freitag said. At the same time, group occupancy continued to decline by approximately 3%, he said.
Among the top 25 markets, Minneapolis experienced the largest occupancy increase for the month, rising 7% to 74.6%, followed by Boston (+6.2% to 86.1%), and Nashville, Tennessee (+6.2% to 74.5%). Washington, D.C., saw the largest occupancy decrease, falling 6.7% to 67.4%.
Oahu Island, Hawaii, jumped 11.6% in ADR to $201.12, which was the largest increase in that metric. St Louis followed, with a 9.5% increase in ADR to $98.05, while Houston’s ADR increased 8.4% to $106.09. Denver reported the largest ADR decline, with a 3.3% drop to $109.62.
Six of the top 25 markets experienced RevPAR increases of more than 10%: Boston (+14.8% to $171.69); Nashville (+14.7% to $83.06); Houston (+13.4% to $77.15); St Louis (+12.6% to $65.36); Dallas (+11% to $68.81); and Minneapolis (+10.5% to $81). Chicago posted the largest RevPAR decrease, dropping 5.5% to $105.25, followed by Washington, D.C., with a 5% decline to $108.84.
“Supply and demand growth (for the top 25 markets) mirrored the U.S., with the notable exception that supply growth was ‘only’ 0.6% versus 0.7% for the U.S.,” Freitag said. “This is an indicator that the room growth happens in secondary and tertiary markets, mostly coming from limited-service hotels.”