The hotel recovery is far from complete
Forecast for booked rooms is up from 2020, but won’t reach 2019’s rates
The recovery of the hotel industry in the United States is far from complete, as an optimistic peak vacation season gives way to what may be a disappointing fall and holiday season.
About 1 billion hotel rooms will be booked in the country this year, according to a forecast from data and analytics firm STR reported by The Wall Street Journal. The figure marks a sizable jump from 829 million in 2020, but a wide gap from the 1.3 billion hotel rooms booked in 2019.
A decline in business-related travel revenue is proving to be a major hit to the industry. The American Hotel & Lodge Association previously predicted a $59 billion decline in business-travel revenue from 2019. The Journal noted that’s a bigger decline than the previous year, which only saw a $49 billion decline.
There are some promising signs in the sector. Group demand, a measure that incorporates both business and leisure travel, rose 5.7 percent in the final two weeks of September, per the STR forecast. The average daily rates for groups jumped $16 during that time to a pandemic-high $214.
Hotel owners are also hoping that increasing vaccination rates and the holiday season will draw tourists back in during the upcoming colder months. International travelers who are fully vaccinated will be able to travel to the United States beginning next month.
Amid hopes for an uptick — and some added pressure from a bill requiring some hotels to pay service employees severance — two prominent New York hotels have kicked off a reopening process. The New York Hilton Midtown reopened on Monday, while the Grand Hyatt in Midtown is set to reopen at the beginning of November.
The city’s beleaguered industry appears to reflect the uphill battle faced by hotels across the country. As lockdown measures were rolled back amid broad vaccine distribution this spring, the industry saw some promising upticks in customers, but still paled in comparison to pre-pandemic rates, with revenue per available room down 62 percent in May compared to the same period in 2019.
An April report from CBRE predicted New York City’s hotel occupancy rates won’t recover to pre-pandemic levels until 2025.
[WSJ] — Holden Walter-Warner