US hotel occupancy falls for first time in 11 weeks. Blame Covid again

Spike in virus cases led states to close beaches, roll back reopenings ahead of July 4 holiday

TRD NATIONAL /
Jul.July 10, 2020 03:00 PM
Coronavirus spikes and subsequent closures snapped 11-week streak of rising hotel occupancy rates

Coronavirus spikes and subsequent closures snapped 11-week streak of rising hotel occupancy rates

The 11-week climb in U.S. hotel occupancy rates ended ahead of the July 4 holiday, in part because of the spike in coronavirus cases led states to roll back their reopenings and close beaches. New hotel rooms that came online also tamped down overall demand, according to the latest figures from hotel data tracker STR.

Nationwide, hotel occupancy stood at 45.6 percent for the week ending July 4, down from 46.2 percent the week prior, STR reported. That latest figure compares to the low-point of 22 percent occupancy, recorded during the second week of April, as Covid-19 cases surged across the U.S. in the first outbreak.

Despite what had been a steady climb, last week’s rate was still 30 percent below the same period in 2019, and STR predicts demand won’t recover to pre-pandemic levels until 2023.

Some good news last week: Revenue per available room, a key indicator of hotel performance, hit $46.21. That’s a roughly $2 improvement over the week before.

STR’s Jan Freitag said recent spikes in Covid cases and subsequent closures of beaches, bars, and other attractions had an impact on “leisure and business” demand in key tourist destinations. Those included Florida, where 44.8 percent of rooms were occupied, and all but two markets in the state recorded a drop in occupancy from the week before. RevPar statewide stood at $57.43.

The top 25 markets in the U.S. recorded lower occupancy and average daily room rate than the national average. Norfolk/Virginia Beach was the only market in STR’s top 25 list where occupancy rose above 60 percent. Meanwhile, Detroit, Tampa/St. Petersburg, and San Diego were the only other markets with more than half of hotel rooms occupied.

New York City’s occupancy rate dropped to 40.1, compared to from 42.4 percent the week before. Earlier this month, New York Gov. Andrew Cuomo barred indoor dining indefinitely and slowed the state’s reopening as cases spiked elsewhere in the country.

Occupancy peaked in New York at 47.6 percent in the last week of May and has slipped each week since. RevPar stood at $52.51.

Los Angeles’ occupancy rate was 43.9 percent and RevPar was just below $54, an improvement over recent weeks. Cases of the coronavirus have spiked in California, however, leading Gov. Gavin Newsom to roll back reopenings earlier this month, including shutting down indoor dining for three weeks.

Chicago’s occupancy rate continues to struggle. It stood at just 36.7 percent, with a RevPar of $31.50.


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