Skip to content

Search

Latest Stories

Report: Mixed extended-stay performance in November

Supply-demand was offset by low ADR growth while the economy segment had a 10.5 percent demand growth, a three-month high

Report: Mixed extended-stay performance in November

EXTENDED-STAY HOTELS reported mixed results in November compared to the broader hotel industry, as supply and demand showed gains and occupancy declined less than the total hotel industry, according to The Highland Group. However, the 2.2 percent net increase in extended-stay room supply for the month, consistent with September and October figures, represents a slight uptick compared to the average over the last 17 months.

Also, relatively low ADR growth led to a modest increase in extended-stay hotel RevPAR.


Supply growth stayed below 4 percent for the 26th consecutive month in November, well under the long-term average, The Highland Group said. The 13 percent increase in economy extended-stay supply and decline in mid-price segment rooms mainly result from conversions, as new construction in the economy segment is estimated at about 3 percent of rooms open compared to one year ago.

Meanwhile, supply change comparisons are influenced by factors such as re-branding, room relocations between segments in The Highland Group's database, de-flagging of hotels not meeting brand standards, and sales to multi-family apartment companies and municipalities, the report said. This trend is expected to persist in 2023, particularly with older extended-stay hotels still on the market. Despite this, the full-year increase in total extended-stay supply compared to 2022 will remain significantly below the long-term average.

Total extended-stay hotel revenue growth in November fell below the previous two monthly increases and slightly trailed the 3.3 percent gain reported by STR/CoStar for all hotels during the same period, it added. Moreover, November marked the third consecutive month economy extended-stay hotels reported a room revenue increase exceeding 10 percent.

The economy segment saw a 10.5 percent demand growth in November, the highest in three months, and the third consecutive month with a demand increase exceeding 9 percent, The Highland Group said. This rise was mainly due to a significant supply gain from conversions, which negatively impacted the change in demand in the mid-price segment. However, total extended-stay demand grew, in contrast to STR/CoStar's estimated 0.2 percent decline for the overall hotel industry compared to November 2022.

Key performance metrics

Extended-stay hotel occupancy declined less than the total hotel industry in November, maintaining a 12.5 percentage points lead, consistent with the historical long-term average occupancy, the report said.

November's extended-stay ADR gain, the lowest since July, was approximately half of the increase reported by STR/CoStar for the overall hotel industry, The Highland Group further said. This marked over two years of monthly total extended-stay ADR surpassing its nominal value in 2019.

Due to low ADR growth, extended-stay hotel RevPAR increased less than half the 2.4 percent gain estimated by STR/CoStar for the total hotel industry, the report said. RevPAR in the economy segment has fallen over the last eight months. However, the rate of RevPAR decline has generally decelerated since July, with November's 1.4 percent fall markedly less than the 4.2 percent contraction reported by STR/CoStar for all economy segment hotels.

In October, Extended-stay hotels outperformed the broader hotel industry across all performance metrics. Despite a dip in occupancy resulting from supply outpacing demand, extended-stay hotels exhibited superior growth in ADR, RevPAR, and revenues compared to the overall hotel industry.

More for you

Olympic Wage ordinance 2028
Photo credit: Unite Here Local 11

Petition fails to stop L.A. hotels wage increase

Summary:

  • Failed petition clears way for Los Angeles “Olympic Wage” to reach $30 by 2028.
  • L.A. Alliance referendum fell 9,000 signatures short.
  • AAHOA calls ruling a setback for hotel owners.

A PETITION FOR a referendum on Los Angeles’s proposed “Olympic Wage” ordinance, requiring a $30 minimum wage for hospitality workers by the 2028 Olympic Games, lacked sufficient signatures, according to the Los Angeles County Registrar. The ordinance will take effect, raising hotel worker wages from the current $22.50 to $25 next year, $27.50 in 2027 and $30 in 2028.

Keep ReadingShow less
AHLA Foundation expands hospitality education

AHLA Foundation expands hospitality education

Summary:

  • AHLA Foundation is partnering with ICHRIE and ACPHA to support hospitality education.
  • The collaborations align academic programs with industry workforce needs.
  • It will provide data, faculty development, and student engagement opportunities.

THE AHLA FOUNDATION, International Council on Hotel, Restaurant and Institutional Education and the Accreditation Commission for Programs in Hospitality Administration work to expand education opportunities for students pursuing hospitality careers. The alliances aim to provide data, faculty development and student engagement opportunities.

Keep ReadingShow less
U.S. holiday travel 2025 trends

Report: U.S. consumers’ holiday travel intent dips

Summary:

  • U.S. holiday travel is down to 44 percent, led by Millennials and Gen Z.
  • Younger consumers are cost-conscious while older generations show steadier travel intent.
  • 76 percent of Millennials are likely to use AI for travel recommendations.

NEARLY 44 PERCENT of U.S. consumers plan to travel during the 2025 holiday season, down from 46 percent last year, according to PwC. Millennials and Gen Z lead travel intent at 55 percent each, while Gen X sits at 39 percent and Baby Boomers at 26 percent.

Keep ReadingShow less
Report: Global RevPAR to rise 3–5 percent in 2025

Report: Global RevPAR to rise 3–5 percent in 2025

Summary:

  • Global hotel RevPAR is projected to grow 3 to 5 percent in 2025, JLL reports.
  • Hotel RevPAR rose 4 percent in 2024, with demand at 4.8 billion room nights.
  • London, New York and Tokyo are expected to lead investor interest in 2025.

GLOBAL HOTEL REVPAR is projected to grow 3 to 5 percent in 2025, with investment volume up 15 to 25 percent, driven by loan maturities, deferred capital spending and private equity fund expirations, according to JLL. Leisure travel is expected to decline as consumer savings tighten, while group, corporate and international travel increase, supporting RevPAR growth.

Keep ReadingShow less
Hotel data challenges report highlighting AI and automation opportunities in hospitality

Survey: Data gaps hinder hotel growth

Summary:

  • Fragmented systems, poor integration limit hotels’ data access, according to a survey.
  • Most hotel professionals use data daily but struggle to access it for revenue and operations.
  • AI and automation could provide dynamic pricing, personalization and efficiency.

FRAGMENTED SYSTEMS, INACCURATE information and limited integration remain barriers to hotels seeking better data access to improve guest experiences and revenue, according to a newly released survey. Although most hotel professionals use data daily, the survey found 49 percent struggle to access what they need for revenue and operational decisions.

Keep ReadingShow less