Higher rates continue to make up for lower occupancies across the U.S. hotel industry, pushing weekly room revenue higher than it was in 2019, but not high enough to negate the effects of inflation.
Data from STR, CoStar’s hospitality analytics firm, shows U.S. hotel industry occupancy for the week ending April 23 rebounded from the pre-Easter slump to 65.8%, down 2.9% from the same week in 2019, which also included Easter Sunday. Occupancy for the week was the 10th highest of the pandemic era; it has been down from 2019 by 3.5 percentage points or less for six consecutive weeks. On Easter Sunday, occupancy was higher than it was in 2019.
Weekend occupancy over Friday and Saturday was 78.2%, the highest level since early October 2021. Weekday occupancy — Monday to Wednesday — was 63.3%, slightly higher than the previous week. Shoulder occupancy — on — Sunday and Thursday — was flat due to a decline on Easter Sunday, which is normal.
Weekday occupancy ranked among the best of the pandemic era in the top 25 markets and central business districts, despite falling slightly post-Easter. At 67.3%, top 25 weekday occupancy was the fifth highest while central business districts averaged 63.6% in weekday occupancy, the sixth best of the recovery. Tuesday through Thursday, top 25 market occupancy surged to 71.8%, its highest for those three days since just before the pandemic. The same was true for the central business districts, where occupancy reached 69.2%.
Average daily rate was 15% higher than 2019 levels, but only 2% higher adjusting for inflation; while revenue per available room was 11% higher than in the comparable week of 2019, or 2% lower factoring inflation. Inflation-adjusted ADR topped 2019 levels for the 13th time since the start of the pandemic, led by 90 U.S. markets that overachieved in the metric.
Of the 166 STR-defined U.S. hotel markets, 156 reported weekly ADR that was higher than 2019 levels, and 13 markets reported their highest ADR of the pandemic era. Weekly ADR for the top 25 markets was $176, the third highest of the pandemic era. Hotel rates in central business districts averaged $227, the second best since March 2020.
Weekly RevPAR was only the seventh highest of the pandemic era, but in the top 25 markets it ranked in the top three, and hotels in central business districts reported their second highest weekly RevPAR of the recovery. Weekend RevPAR in both the top 25 markets and central business districts was the highest it's been since the start of the pandemic.
Over the past 28 days, 70% of U.S. markets achieved “peak” RevPAR — higher than 2019 levels — and just three markets were in “recession,” with RevPAR between 50% and 80% of 2019 levels. Adjusted for inflation, RevPAR was at “peak” in 40% of markets. The good news is that even on an inflation-adjusted basis, there are no markets in “depression,” with RevPAR below 50% of 2019 levels.
Market Highlights
Six markets including Boston reported their highest RevPAR since early March 2020. Weekly RevPAR surpassed 2019 levels in 126 of the 166 markets, which is the most since the beginning of the year.
The Florida Keys led U.S. hotel markets with 86.7% occupancy, followed by Charleston, South Carolina, at 80.8%, and Savannah, Georgia, at 80.2%. Other notable occupancy levels were observed in Orlando, at 78.9%, which hosted The Cheerleading Worlds 2022, and New York, at 78.5%, its third best of the pandemic era. Of New York’s 10 highest pandemic-era occupancy levels, six have occurred in the past six weeks.
Washington, D.C., and Charleston, South Carolina, were among seven markets that reported their highest weekend occupancy of the pandemic era. Charleston had the best weekend occupancy of any market this week at 93.4%, with nine others including Austin, Orlando and San Diego reporting occupancy above 90%.
Palm Springs, the submarket which hosted the Coachella Music and Arts Festival, recorded its third-highest weekend occupancy of the pandemic era at 89%, after achieving 94.9% the prior weekend to kick off the festival, which was its highest weekend occupancy.
Hotels in California’s wine country also reported strong weekend occupancy with both Napa, at 90.7%, and Santa Rosa/Sonoma, at 91%, posting their highest weekend occupancy levels since March 2020.
With the 126th running of the Boston Marathon, Boston hotels achieved the highest weekday occupancy since March 2020 at 72.1%. The Los Angeles and Washington, D.C., hotel markets reported their second-best weekday occupancy of the pandemic era.
Isaac Collazo is VP Analytics at STR.
This article represents an interpretation of data collected by CoStar's hospitality analytics firm, STR. Please feel free to contact an editor with any questions or concerns. For more analysis of STR data, visit the data insights blog on STR.com.