STR, a hospitality industry data provider, said it was “surprised” to see US revenue per available room (RevPAR) fall in the week ending Sept. 13, the week following Labor Day, as this was one of the “clean” comparable weeks in the month without any calendar shifts.
Weekly RevPAR fell by 1.7%, its largest decrease of the past eight weeks. As has been seen in most weeks this year, falling occupancy drove the decline as average daily rate (ADR) remained stagnant (down 0.1%). Since April, occupancy has dropped every week except for two. What’s even more concerning, according to the research, is the continuing room rate trend. That measure has seen increases at or below 0.5% in 13 of the past 24 weeks.
Similar to last week, the RevPAR retreat was mostly in the Top 25 Markets (T25), but this time the gap between the T25 (down 3.5%) and all other markets (down 0.2%) was much larger and the most of the past three weeks. Six of the T25s saw double-digit RevPAR decreases.
A fall in group demand drove the weekday RevPAR declines in Atlanta, Las Vegas and Orange County. Other Top 25 Markets seeing significant decreases in weekday group demand included Chicago, Nashville, St. Louis and Tampa Bay. Overall, weekly group demand across the US (among all luxury and upper upscale class hotels) was down 5%, which was the 10th consecutive decline. Group ADR, however, has continued to increase, with the measure up 3.2%. Unlike total ADR, group room rates have been trending above the rate of inflation in nearly every week of the year.
New York, Phoenix, Boston, Dallas and San Francisco reported weekly RevPAR gains of more than 4%, and all were mostly driven by rising ADR. New York also had the nation’s highest occupancy (88.2%) for the third consecutive week.
For the ninth consecutive week, luxury led all hotel classes, with RevPAR growth of 2.2%. In six of the past nine weeks, and for two consecutive weeks, it has been the only class with RevPAR growth. Economy was down 6.3% and has seen decreases of 4.5% or more for 11 consecutive weeks. All other classes saw declines between 1.6% (upper upscale) and 3.4% (midscale) during the period.
