OK, I know what everyone’s thinking here: More egghead stuff from the STR folks.  While there is indeed a great amount of truth to that statement (not as it relates to me personally, of course) in these very trying times, looking at seasonally adjusted data can give us the first clues to the long anticipated and uncertain recovery.

Without getting into the details of how this works—or worse yet, how the math behind the numbers are calculated—the primary reason to look at data in this manner is to compare the current month’s performance to the prior month. For example, using this type of analysis enables you to look at April 2009 results as compared to March 2009.  Without seasonally adjusting the data, comparing the current month to the prior month is impractical due to seasonal factors, number of days in the month, et cetera. 

Therefore, hotel industry operating results typically compare current month performance to the same month of the prior year. In addition, year-to-date and either three-month or 12-month moving averages also are used to gauge trends.

While the traditional measures of performance are relevant, it typically takes an extended period of time before changes in trends can be identified. Seasonally adjusted data can, however, help us identify these trends faster.

Why mention this now? Well, in looking at April 2009 data, we see both seasonally adjusted hotel demand and average room rates actually improve over March. While the seasonally adjusted results are still well below the peaks recorded early last year and one month of improvement certainly does not signal a sea change, we view this change as relevant as it is the first time this has happened since the middle of last year.

As we have said before, the recovery has to start somewhere, and we believe it possible that throughout the summer we may again see some modest improvements in these seasonally adjusted numbers.  

We can only hope!