The bottom is dropping out of the bottom
 
The bottom is dropping out of the bottom
17 NOVEMBER 2009 10:25 AM

A most important measurement of how hotels may recover just came out to silent acclamation. No one wants to talk about it. Stop reading if you are faint of heart.

Shhhh. Quiet … don’t tell anyone, but …

A most important measurement of how hotels may recover just came out to silent acclamation. No one wants to talk about it. Stop reading if you are faint of heart.

The plunge in revenue per available room started in October of ’08 after the Lehman Brothers meltdown. Since then it’s been one really bad week after another in year-over-year comparisons. The first week of November ’08 looked really bad because it was compared to November of ’07 (at the peak of the market)—RevPAR was down 17.2 percent. That trend continued for 52 weeks.

But we were all hoping that the first week of November ’09, since it compares with an already down ’08 week of 17.2 percent, would show serious improvement. Most of us hoped it would be down only 0 percent to 5 percent.

And the envelope please …

The first week of November ’09 RevPAR compared to the same week in ’08 is down another … frightening … 11.8 percent.

Read the weekly results from Smith Travel Research.

So what does this mean for your hotel? Owners as well as employees are suffering, and this news will only make it worse. Christmas has been put off another year.

Many owners have done everything they can to keep their hotels from foreclosure—delaying maintenance, holding off on required property improvement plans from franchisors, cutting sales staff, and not paying themselves fees. Employees who still have their jobs have been working harder and often longer with no raises since 2007—and in properties that are increasingly capital-starved. 

But let's remember this IS the hospitality business, and we have a time-honored job to take care of our guests. If we do this, we will feel better every day (sort of ancient wisdom here), and the recovery will at least seem to arrive sooner.

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