2012 US hotel demand to exceed 2007
September 6, 2012
According to a new issue of Hospitality Directions, PricewaterhouseCoopers (PwC) notes that despite persistent economic headwinds and heightened uncertainty, U.S. RevPAR recovery in 2012 is projected to remain intact, with slightly stronger gains in both demand and pricing than previously anticipated.
The firm reports that the lodging recovery is continuing into the second half of 2012, and with that, it has adjusted its revenue per available room outlook to increase 7.2 percent this year, followed by 5.6 percent in 2013.
Results for the first 18 days of August show an approximately 7.2-percent increase in RevPAR.
Macroeconomic Advisers‘ August outlook expects slower economic growth in 2012 than it previously anticipated, followed by gradual improvement in 2013, with real GDP increasing 1.8% in 2012, followed by an increase of 3.0% in 2013, measured on a fourth quarter over fourth quarter basis.
With hotels reporting a solid pace of forward bookings for the balance of the year, including a greater volume of group bookings, PwC said these results indicate momentum in travel activity and set a context for hotels to price more confidently entering the second half of 2012.
Overall, PwC expects lodging demand in 2012 to increase 3.0%, which combined with still restrained supply growth of 0.5%, is anticipated to boost occupancy levels to 61.5%, the highest since 2007.
PwC anticipates hotel occupancy will increase 2.5 percent in 2012, coupled with a 4.6-percent increase in ADR. Hotels in these segments experienced the greatest decline during the recession, but have advanced quicker than hotels in other lower-end segments in rebuilding occupancy levels. PwC expects occupancy in the luxury, upper upscale and upscale segments to meet or exceed each segment’s 2007 average.
Overall, industry RevPAR is expected to recover to $65.41 in 2012, just slightly below its prior peak of $65.54 in 2007.
Full Report – PwC Hospitality Directions US Q2
Posted by Scott R. Lodde