The Baird/STR Hotel Stock Index dropped 8.2 percent in January, according to STR. It underperformed Both the S&P 500, which fell 1.1 percent in January, and the MSCI US REIT Index, which remained flat.

THE BAIRD/STR Hotel Stock Index dropped 8.2 percent in January, according to STR. The decline in performance came in connection with difficulties in distribution of the COVID-19 vaccine.

Both the S&P 500, which fell 1.1 percent in January, and the MSCI US REIT Index, which remained flat, outperformed the Baird/STR index. The hotel brand sub-index dropped 9.1 percent from December while the hotel REIT sub-index decreased 5.3 percent.

In December, the Baird/STR rose 5 percent based on some optimism following the announcement of the vaccines, but over the month that feeling changed.

“Hotel stocks pulled back in January and significantly underperformed the broader indices as the vaccine rollout and reopening narrative lost some momentum,” said Michael Bellisario, senior hotel research analyst and director at Baird. “The ‘pent-up demand’ thesis remains topical for bullish investors and industry participants, especially on the leisure travel front, but the more important intermediate- to long-term recovery needs to come from the business traveler, for which a rebound appears further out, in our opinion.”

The first few months of the year will likely resemble the slowest months of 2020, said Amanda Hite, STR president.

“Once vaccine distribution becomes more widespread and the pandemic numbers improve, we should see better travel conditions that will push recovery,” Hite said. “Our latest forecast points to Q3 as the period with more meaningful recovery of corporate and group business.”