Is Group Demand Slipping?
Hotel report also shows transient occupancy surging.
by Michael J. ShapiroMarch 1, 2013
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Group demand at hotels in the United States decreased by 3.6 percent during 2012, according to lodging data provider STR.
“In 2012, U.S. hotels sold more rooms than ever before,” said Jan Freitag, senior vice president of global development for Nashville-based STR. “But it appears transient travel was responsible for that surge, while there likely was a slowdown in group travel.”
A few factors could be skewing the figures, Freitag suggested. First, it’s possible that group demand has moved to Las Vegas, a city STR does not track. On the other hand, as some hotel owners have noted, many leisure groups that booked room blocks in the past are now having travelers book independently online. “In that case,” Freitag said, “we might be looking at a false negative.”
It’s also possible that the numbers reflect a trend toward shorter, more local meetings that require fewer or no room nights. “All three factors probably have some influence,” said Freitag.
Whatever the causes, Freitag, notes, some regional market data clearly is showing a notable shift toward transient occupancy. “Particularly in several cities where the majority of occupancy previously was group business,” Freitag said, “we’re seeing the transient/group traveler balance move toward 50/50.”