PKF Predicts Long-Term RevPAR Growth
by Michael J. ShapiroDecember 19, 2012
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Revenue per available room for U.S. hotels is projected to grow at a compound annual average rate of 7.2 percent over the next four years, according to the latest forecast from PKF Hospitality Research. The company's forecast, including a 6 percent rise in RevPAR for 2013, assumes that the U.S. government will resolve its current budget issues. "There is a pall on lodging industry participants induced by the federal budget negotiations," said PKF-HR president R. Mark Woodworth in a statement. "Hoteliers are eager to begin enjoying what appears to be a four-year period of sustained high levels of prosperity. Unfortunately, there is so much uncertainty surrounding 2013 that almost no one overtly is showing the optimism that should exist." Woodworth added that should the budget talks fail, 2013 RevPAR growth will likely be well below the forecasted 6 percent.
If there is a budget resolution, PKF-HR expects the national occupancy to hit 62.1 percent by the end of 2013, which would surpass the long-run average occupancy level of 61.9 percent. That gain should spur rate growth, leading to an annual 5.4 percent rise in ADR for the next four years on a compound basis.
Consulting firm Deloitte, meanwhile, is cautiously optimistic in its outlook for travel, hospitality and leisure in 2013. Companies in the industry have the power to grow domestically this year, according to vice chairman Adam Weissenberg, as well as to capitalize on emerging market growth. He advises companies in the sector to simplify their corporate structures further, focus on customer loyalty, look for growth in new markets and streamline operations through the use of technology.