U.S. HOTELS SAW more declines in occupancy and RevPAR in September, rounding off a third quarter that, while mostly positive, still showed signs of slowing, according to STR.
For September, occupancy was down 0.9 percent to 67.4 percent over the same time last year. ADR increased 0.6 percent to $131.93, while RevPAR decreased 0.3 percent to $88.91.For the third quarter, occupancy declined 0.1 percent to 70.9 percent, but ADR rose 0.8 percent to $133.25 and RevPAR rose 0.7 percent to $94.42.
September’s performance as the second month of the year with a negative results is an indication that the U.S. hotel industry is slowing down, said Jan Freitag, STR’s senior vice president of lodging insights.
“Demand only grew 1.2 percent, not strong enough to overcome a 2 percent increase in supply, so occupancy declined for the third time this year. Hotels at the high end, in the luxury and upper upscale classes, were able to report slight RevPAR increases, but all other classes showed declines.”
The third quarter results also were mixed, said STR’s Senior Vice President of Operations Bobby Bowers.
“While RevPAR increased slightly, it was the lowest year-over-year percent change in the metric since the first quarter of 2010, and the first quarter during the current cycle to show an increase in the metric below 1 percent,” he said. “While demand growth slowed to 1.8 percent, the industry sold more nights than any other third quarter in history. Keeping in line with that theme, third-quarter room revenue reached $46.5 billion, the highest quarterly room revenue figure in STR’s U.S. database.”
September was the 115th month of the current expansion cycle, and RevPAR increased over the previous year in 112 of those months. The exceptions were September 2018, which saw a 0.3 percent RevPAR drop, and June, during which it sank 0.4 percent.
Among the top 25 markets, Orlando experienced the largest drop in occupancy for the month and the quarter, down 9 percent to 61.6 percent in September and down 5 percent to 69.6 percent for the quarter. It also had the only double-digit RevPAR decline, down 11.9 percent to $64.55.
Miami reported the steepest decrease in ADR for September, down 4.3 percent to $134.59, and the one of the deepest dips in RevPAR for the quarter, down 5.1 percent to $101.68. The area tied with Seattle in that metric, with the Northwestern city also losing 5.1 percent to finish at $154.70.
New Orleans registered the largest increase in RevPAR in September, up 11.8 percent to $92.4, primarily due to the highest rise in occupancy, up 9.2 percent to 66.4 percent.
The largest increase in ADR for September was reported at Washington, D.C.-Maryland-Virginia, coupled with the month’s only other double-digit increase in RevPAR, up 10.3 percent to $123.22. It also had the highest lift in ADR for the quarter, up 4.0 percent to $148.43.
Phoenix saw the largest jump in RevPAR for the quarter, up 5.3 percent to $60.57, and Houston had the highest rise in occupancy, up 4.4 percent to 62.4 percent.
Occupancy, ADR and RevPAR continued to drop in the first week of October, STR announced previously.