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by Michael J. Shapiro | February 24, 2012

Despite the rebound in group demand at hotels, group rates continue to lag, according to STR publication HotelNewsNow.com. Based on STR data presented at a revenue management webcast this week, group demand is now on a par with 2007 levels; the rate, however, remains closer to 2010 numbers. The discrepancy is due in part to rates that planners were able to negotiate in 2009 and only now are being realized, according to STR senior vice president Jan Freitag. While transient average daily rate at upper-tier hotels climbed from $176 in 2007 to $160 in 2011, the group rate moved in the other direction: from $161 to $147. That lag is slowing overall rate recovery in the U.S., Freitag noted. "We're suggesting that in the next two years...that we're going to get back to peak ADRs nominally," he said. "But adjusting that for inflation, we're still way, way below where we were in 2007."