In a Feb 16, 2011 article in MarketNews.com, Claudia Hirsch chimes in on what all of us are seeing. The following are some quotes from her article.
“After discounting prices throughout the recession, U.S. hotels have begun gently repairing room rates as occupancy levels increase, but full price restoration is still far off, according to hotel executives, travel agents and meeting planners. Lodging prices began edging higher in 2010. Stronger leisure and business occupancy has prompted the turnaround in room prices, and early 2011 signs point to guest counts trending upward throughout the year.”
(We’re also seeing a strong return of the vaunted Business Traveler in the central PA markets that we serve. It’s been helping us to register some strong revenues. In October through December 2010 our Holiday Inn Express & Suites actually logged its best 4th quarter revenue ever. It’s been open for 17 years. There are other competitive factors at work in that local market, but it’s an indication of the resiliency of the industry.)
“Still, a return to pre-recession room prices is likely a year or more away for many hotels… At a three-star hotel off New York City’s Times Square, room prices have nudged 6% to 7% higher year-to-date vs. last, despite a growing glut of inventory in the metropolis. ‘Our occupancy is up, and the consumer is more confident. We can see it and feel it. But at the same time, they want value,’ said John Canavan, general manager at the Hotel Edison.”
Springwood has seen the same trend. Our rates are up across the board, and occupancies are improving, but we have yet to see pre-recession ADR’s. It could be a couple more years until prices fully recover.
by Dave Hogg