by Michael J. Shapiro | April 27, 2018
In Mexico, average daily hotel rates for the the first quarter dropped by 5 percent on average vs. the same period last year, according to new data from STR. The lower rates might have kept the visitors coming -- occupancy actually rose by 0.6 percent -- but the revenue per available room was down by 4.4 percent for the quarter.
"Travel warnings were issued by the U.S. State Department within the last year, most recently in March, which cautioned against traveling to popular destinations in Mexico," pointed out Fatima Thompson, STR's associate director of business development, hotels. "This travel advisory is reflected in the mixed hotel results during the first quarter of 2018."
The March security warning, which has since been lifted, advised against travel to Playa del Carmen, a popular resort town in the Riviera Maya, south of Cancún. The warning was in response to an unspecified threat, and it was in effect only for a couple of weeks, but it came at a time when many travelers were preparing to leave for spring-break vacations.
First-quarter occupancy was down 1.9 percent year-over-year in the Yucatán Peninsula, home to Playa del Carmen and Cancún, while ADR dropped 3.9 percent and RevPAR fell by 5.7 percent, according to STR. The Cancún performance might have been at least as affected by supply growth, however: According to STR figures, supply in Cancún grew by 3 percent but demand only increased by 2.8 percent.
Mexico's best regional Q1 performance came in Northeast Mexico, as defined by STR, despite the U.S. State Department's slapping a Level 3 designation (meaning "reconsider travel") on the state of Nuevo Leon, home to the business and manufacturing hub of Monterrey. Occupancy in the region leapt by 8.9 percent, for a 9.9 percent rise in RevPAR. The region posted the only rise in ADR as well, with a 0.9 percent uptick.
Northwest Mexico -- home to the Los Cabos resort area -- reported the country's second-largest rise in occupancy, at 4.5 percent, and the country's only other RevPAR increase, which inched up by 0.2 percent year-over-year. The state department did not impose any travel restrictions on Los Cabos in January's Mexico Travel Advisory.
Mexico City suffered the country's steepest drop in RevPAR, down 7.6 percent for the first quarter, and the biggest decrease in ADR, which dropped by 6.3 percent. The U.S. Mexico Travel Advisory imposed no specific travel restrictions on Mexico City.

The Mexico Central South region, home to the states of Chiapas, Guerrero and Oaxaca, experienced the steepest occupancy decline, falling by 4.5 percent, and the second-largest drop in RevPAR, which fell by 5.9 percent. The state of Guerrero, home to the resort city of Acapulco, received a Level 4 "Do not travel" designation from the U.S. State Department in the Mexico Travel Advisory, due to the amount of criminal and cartel-related activity in the state.