by Michael J. Shapiro | February 15, 2018

Solid growth in revenue per available room and strong hotel-development pipelines were themes running across major hospitality earnings reports yesterday, as hotel companies continue to enjoy unprecedented demand.

At Hilton, RevPAR was up by 3.8 percent for the fourth quarter of 2017 and 2.5 percent for the full year, driven by increases in both average daily rate and occupancy. The company's international-hotel performance was particularly strong.

Marriott International's RevPAR performance was even more impressive, growing worldwide by 4.6 percent in the fourth quarter and 3.1 percent for the full year. In North America, those increases were 3.9 percent and 2.1 percent, respectively. 
"2017 was a terrific year," noted Arne Sorenson, president and CEO of Marriott. "We made great progress on the integration of Starwood, capturing significant property and corporate-overhead cost synergies while also increasing our worldwide RevPAR index... In the first full year after acquiring Starwood, solid RevPAR gains, strong rooms growth and property-level margin improvement combined to deliver record fee revenue." 
Marriott's fee revenue of $865 million in the fourth quarter exceeded expectations, and the company is forecasting $3,535 million to $3,620 million in fee revenue for 2018.
RevPAR was up at Hyatt Hotels as well, by 3.8 percent for the fourth quarter and 3.3 percent for the year. 
Given such sustained hotel demand, the robust development pipelines come as no surprise. Hilton has a record pipeline of 345,000 rooms under development, and approvals for 108,000 more. 
"Given the strength of our brand portfolio, we continue to build momentum in both unit and pipeline growth, and now have the largest number of rooms under construction in the industry," said Hilton president and CEO Christopher Nassetta. "We feel great about our setup for 2018 and our ability to continue delivering record-setting results."
Marriott's worldwide development pipeline now includes more than 460,000 rooms. In 2018 alone, Sorenson anticipates the number of open rooms to increase by about 7 percent gross, with only 1 to 1.5 percent of the company's room count dropping out of the portfolio.
Hyatt's footprint, though considerably smaller, is also growing by leaps and bounds. The chain's net number of hotel rooms jumped by 7 percent in the fourth quarter of 2017, thanks to a record 71 new hotel openings for the company. As of the end of the year, Hyatt had about 70,000 rooms in the pipeline, representing about a 6 percent year-over-year growth.
Hyatt also reported noteworthy U.S.-based group demand in the fourth quarter, with group rooms revenue up by 3.4 percent. The number of group room nights edged up by 0.8 percent, and their average daily rate was up by 2.6 percent. Those numbers all exceeded transient growth rates.