Hospitality Consulting Advice that Hotels Up Skewed by Top 25 Cities

Many hospitality consulting experts and industry analysts have been touting the recent rise in hotel fundamentals such as demand, occupancy and ADR (average daily room rates). However, this article in a major online trade publication says it isn’t so rosy given that the stats are significantly impacted by the top twenty-five markets in the USA, such as New York. Here are a couple excerpts and why your hotel may not be feeling the so-called positive upturn according to Glenn Haussman, Editor-in-Chief of Hotel Interactive: – “But while many industry insiders were publicly lauding the industry’s returning mojo, one thing has become abundantly clear: Many people on the property level have yet to see and feel what these top level leaders are extolling.” – “According to STR, 2010 saw 52,000 U.S. hotels, a two percent increase from the previous year. Demand was up 7.8 percent with occupancy of 57.6 percent, a 5.7 percent increase from 2009. ADR was $98, a drop of 0.1%, while RevPAR came in at $56.50, a 5.5 percent drop. Overall room revenues increased 7.6 percent to $99.5 billion. Sounds good, right? Here’s the truth.” – “The root problem here is the overreliance on industry statistics that do not take into account the huge difference in potential market conditions for New York City and Decatur, GA. The Big Apple is so strong and powerful it’s skewing the average numbers for the entire country.” Read more on the whole story here and especially what one hospitality consulting firm says you must do regarding room rates. On a separate note, AAA is predicting that travel for the Labor Holiday weekend will be down. This is based on high unemployment and travel expenses, such as higher gasoline and airfare prices. Read what other issues the hotel advisory services group says will affect your guests vacation planning. Are you an investor, hotel owners representative or operator experiencing a downturn in your hotel market which is contrary to what the statistics say? What can you share from a hospitality consulting standpoint is the lack of growth or ability to raise prices in your area?