REVENUE PER OCCUPIED room from U.S. hotel food and beverage services rose 1.6 percent in 2017 over the previous year, according to STR. Most of that increase came from a 4.7 percent per seat rise in revenue from hotel venue operations and a 0.8 percent per square foot increase in catering for special events.
F&B revenue rose from $103.93 in 2016 to $105.56 last year, an increase seen in all hotel classes, STR said. Hotel venue operations revenue went up 4.7 percent per available seat.
“Innovation and concept changes had a positive impact on hotel F&B results in 2017, particularly with creative use of space for venue operations,” said Veronica Andrews, STR’s director of digital data solutions. “We know that as catering-and-banquets performance goes, so goes the F&B department. With an industry average of 25,000 square feet of meeting space per property reporting to STR, that 0.8 percent increase represents substantial revenues from hosted events in hotels and resorts across the country.”
At the same time, in-room dining revenue per room dropped 3 percent, but Andrews said that does not predict a continued decline. “In-room dining results reflect a myriad of changes in deliverables and brand standards,” Andrews said. “In some cases, non-discretionary service charges give way to ‘grab-n-go’ or marketplace operations or other alternative in-room dining options. We also should keep in mind that in-room dining, as a revenue center, is the smallest revenue-generating operation in the F&B department.”
STR also found that a decline in group travel business in major markets, including Atlanta, Chicago and Miami, has led to decreases in F&B performance for luxury and upper upscale hotels. Washington, D.C., remained an outlier to that trend with a 0.8 percent increase in catering and banquets revenue per seat due to a 6.1 percent rise in group room revenue.