These hotel markets have entered a depression
Even as travel picked up, establishments struggled, notably in NYC and Chicago
Some U.S. hotel markets are in such bad shape that a recession would look good.
Though leisure travel is picking up, New York City’s lodging market has entered an economic depression, according to a report from the American Hotel & Lodging Association. Revenue per available room, the industry’s standard measuring stick, was $95 in May, down 62 percent from $249 in May 2019.
“While some industries are starting to rebound as Covid-19 restrictions ease across the country, the U.S. hotel industry is still in a recession, with the hardest hit markets in a depression,” Chip Rogers, president and CEO of AHLA, told the New York Post.
Some hotels were buoyed through the pandemic by government; California launched a huge program called Project Roomkey, and New York City rented rooms for homeless people to avoid overcrowding in shelters. But now, as the pandemic wanes, New York has begun moving thousands of people out of hotels and back into traditional temporary housing.
The landscape isn’t much better in other cities across the country. Chicago’s hotel revenues per available room dipped by 59 percent from May 2019, casting the city into a depression of its own. Los Angeles, which only qualified for a recession by the report’s standards, still saw revenues per available room drop by 27 percent. The nationwide average fared only slightly better, enduring a 22 percent slip from $91 to $69 per room.
These numbers do not take into account hotels that are closed. Many closed permanently during the pandemic.
However widespread the despair may be, there’s a silver lining in southern Florida. The Miami hotel market actually grew revenue per available room, or RevPar, by 30 percent in the past two years, making it one of just three cities in the report to post positive numbers.