STR Forecasts Continued U.S. Hotel Growth Through 2016
The U.S. hotel industry will experience continued performance increases through 2016, according to STR and Tourism Economics, which released their latest forecast this week at the NYU International Hospitality Industry Investment Conference. For the remainder of this year, the forecast calls for a year-over-year occupancy increase of 1.4 percent, to 65.3 percent for the year, as well as a 5.2 percent hike in average daily rate, to $120.93. The 2015 revenue per available room is expected to be $78.99, a 6.6 percent increase over last year. The forecasters expect demand growth to double that of the supply increase, at 2.6 percent vs. 1.3 percent. "All of the key performance indicators are at record highs," pointed out STR president and COO Amanda Hite, "and barring a black-swan event that jars the global economy, we don't expect any dramatic changes during the foreseeable future."
The luxury-chain segment is expected to enjoy the highest average daily rate increase, at 5.5 percent, while the steepest occupancy gains should be seen in the upper-midscale segment, which is forecast to climb by 1.9 percent. Upper midscale and economy are likely to see the greatest RevPAR increase, which is forecast to be 7.1 percent. Overall, the RevPAR growth is expected to exceed 5 percent in 20 out of the top 25 major markets; three markets are expected to see RevPAR growth in excess of 10 percent (Denver, Phoenix and Tampa/St. Petersburg, Fla.).
The forecast calls for solid year-over-year increases once again in 2016, with a 5 percent ADR increase, 5.8 percent RevPAR gain and a 0.8 percent uptick in occupancy. Demand should once again outstrip supply, though by a slightly smaller margin, at 2.2 percent vs. 1.4 percent. Top markets likely will continue to reap the benefits, with 20 out of 25 predicted to see RevPAR increases of between 5 and 10 percent.