EXTENDED STAY HOTELS in the U.S. had a robust first quarter, reports The Highland Group.
The sector significantly outperformed all hotels combined, most notably in revenue generation, said the report released on May 16.
In the first quarter of 2017, room revenue in extended stay hotels grew 10.5 percent over the same quarter a year ago.
All hotels saw a 5.4 percent hike in room revenue versus the same period in 2016.
“Extended stay hotel room revenues are growing at approximately $1 billion annually and about twice as fast as the overall hotel industry,” said Mark Skinner, partner at The Highland Group.
The sector’s first-quarter growth in demand exceeded the change in supply for the first time in two years, said the report. The jump in demand “reversed the trend of declining occupancy” reported over the previous seven quarters, and “provides a solid foundation to absorb the record number of new rooms under construction,” Skinner said.
ADR rose by 3.4 percent, the same increase recorded in the fourth quarter of 2016. Occupancy was flat, averaging 72.3 percent, a 0.3 percent increase over the year-ago quarter. RevPAR was up 3.7 percent.