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| R. Mark Woodworth |
Atlanta, GA, Sept. 7, 2016 – The magnitude of change in
the major industry indicators is not pleasing U.S. hotel owners and
operators. New development activity
continues to accelerate, while growth in average daily room rates (ADR) has
decelerated.
The sluggish start during
the first half of the year resulted in another downgrade by CBRE Hotels’
Americas Research of its forecast for the entirety of 2016.
“It has been very
interesting dissecting the performance of the U.S. lodging industry during the
first half of 2016,” said R. Mark
Woodworth, senior managing director of CBRE Hotels’ Americas Research.
“On the one hand, we are comforted by the continual
growth in accommodated demand. After
all, if people stop traveling, nothing else really matters.
"On the other hand, there continues to be a
disconnect between the record occupancy levels and the inability of hoteliers
to increase room rates.”
According to STR, U.S.
lodging demand increased by 1.6 percent during the first half of 2016 compared
to the first half of 2015. At the same
time, hotel rooms supply rose by just 1.5 percent, resulting in a 0.1 percent
boost to occupancy. With demand and
occupancy on the rise, ADRs did increase by 3.1 percent, but this is less than
the 4.1 percent pace seen during the first half of 2015 and the annual 2015
growth rate of 4.4 percent.
 |
| John B. (Jack) Corgel |
Based on the first half performance data, CBRE
Hotels’ Americas Research adjusted its forecast for the year 2016. According to the firm’s September 2016 Hotel
Horizons® forecast that was released at the STR Hotel Data Conference, U.S.
hotels will enjoy a 0.1 percent increase in occupancy for the year, concurrent
with a 3.5 percent rise in ADR.
This results in a RevPAR
gain of 3.6 percent. The occupancy
forecast represents an improvement over the 0.1 percent decline presented in
June 2016 edition of Hotel Horizons®, but the ADR and RevPAR forecast rates are
0.8 and 0.6 percentage points less, respectively.
“When analyzing prices in
any industry, it is common to gauge movements relative to the pace of
inflation, or real change,” said John B.
(Jack) Corgel, Ph.D., professor of real estate at the Cornell University
School of Hotel Administration and senior advisor to CBRE Hotels’ Americas
Research.
“In real terms, the 3.5 percent nominal
increase in ADR forecast for 2016 represents a 2.5 percent real change. This will be the eighth greatest real change
in ADR since 1988.”
For a complete copy of the company’s news release,
please contact:
Chris Daly
Daly Gray Public Relations
703 435 6293
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