by Calculated Risk on 6/19/2015 01:17:00 PM

First from HotelNewsnow.com: Record US results set stage for more growth

April 2015 saw the highest annualized occupancy in the U.S. hotel industry’s history, [Amanda Hite, president and COO of STR said].

During the 12 months ending in April, demand was up 4.5%, which is above the industry’s 20-year compound annual growth rate of 1.6%.



“We continue to experience some of the best fundamentals that we’ve had with demand growth well outpacing the supply growth,” Hite said.

“We’re in a great part of the economic hotel cycle. … There hasn’t been a lot of new supply coming into the various markets,” [Steve Rushmore Jr., president and CEO of HVS] said.

This graph from STR shows change in demand and supply for hotel rooms.

Strong demand and little supply growth (more will be coming - and that is good news for jobs).  The current situation is the opposite of 2009 when demand was collapsing, and more supply was coming on the market.

From HotelNewsNow.com: STR: US hotel results for week ending 13 June

The U.S. hotel industry recorded positive results in the three key performance measurements during the week of 7-13 June 2015, according to data from STR, Inc.

In year-over-year measurements, the industry’s occupancy increased 2.6 percent to 73.7 percent. Average daily rate increased 5.0 percent to finish the week at US$121.24. Revenue per available room for the week was up 7.8 percent to finish at US$89.33.
emphasis added

The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.  The occupancy rate will be high during the summer travel season.

The red line is for 2015, dashed orange is 2014, blue is the median, and black is for 2009 - the worst year since the Great Depression for hotels.  Purple is for 2000.

The 4-week average of the occupancy rate is solidly above the median for 2000-2007, and solidly above last year.

Right now 2015 is close to 2000 (best year for hotels) - and so far 2015 has run slightly above 2000 - and this year will probably be the best year ever for hotels.

Data Source: Smith Travel Research, Courtesy of HotelNewsNow.com