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Half empty or half full? Hotel occupancy rate nears 50%
Rate still remains over 40% below last year’s totals for NY, LA, Chicago and Miami
Hotels are continuing their comeback, ever so slowly.
The occupancy rate across the U.S. hit 48.9 percent for the week ending Aug. 1, according to hotel data tracker STR. The rate has increased for 15 of the last 16 weeks; the streak was interrupted in the week ending July 4 because of a surge in coronavirus cases.
Occupancy rates do not take into account hotels that are closed.
In the Los Angeles/Long Beach market, the rate was just under 50 percent, while New York continued to struggle, with an occupancy rate of just 36 percent. Chicago recorded an occupancy rate of 38 percent and Miami just 33 percent.
All four cities remained more than 40 percent below their occupancy rates from the same time last year. And of those four, only New York’s $59.40 revenue per available room exceeded the national average of $45.97. Miami and Chicago RevPars were each around $33.
In the last month, overall hotel occupancy has increased just three percentage points.
Those numbers may not improve significantly any time soon. Last week, Dr. Deborah Birx, the White House coronavirus task force coordinator, advised that the U.S. was entering a “new phase” of the virus, one in which infections were “extraordinarily widespread” in both rural and urban communities.
Summer has led to an uptick in hotel bookings, but STR’s Jan Freitag said, “what happens after Labor Day, when people go back to school, if they go back, and leisure numbers decrease? We expect corporate group demand to stay very low.”
Hotels in metro areas remain the hardest hit. Among the top 25 markets, only Norfolk/Virginia Beach, Virginia, cracked 60 percent occupancy. And just three other markets — Detroit, San Diego and Philadelphia-New Jersey — exceeded 50 percent.
Oahu Island in Hawaii and New Orleans registered the lowest occupancy rates at 21.4 percent and 29.7 percent, respectively.
Freitag added that in the remaining days before the school year begins, he expects travelers may also drive out to wide-open spaces — in addition beaches — in states like Idaho, Montana, South Dakota and Wyoming.
Contact Orion Jones at orion.jones@therealdeal.com