Despite an expected boost in group business from the Easter calendar shift, March saw only a 0.6 percent increase over the same time last year, the lowest growth in rates since May 2010, according to STR.

U.S. HOTELS SAW little growth in business during March, the least amount of growth since the recession, in fact, according to STR. Results for the first quarter of the year also were less than forecast.

Occupancy for March stayed the same as it was during that month last year at 68.4 percent. ADR rose 0.6 percent to $132.66 while RevPAR increased just 0.6 percent to $90.78

“Considering there would have been a helpful pivot in group business because of the Easter calendar shift, this was probably the industry’s worst March since the recession,” said Jan Freitag, STR’s senior vice president of lodging insights. “The 0.6 percent change in ADR was the lowest for any month in the U.S. since May 2010, which indicates that pricing confidence may have not yet reached its floor. On the plus side, we continue to break monthly demand records, which is keeping overall performance in the black. The challenge of course is maintaining profit margin during a time of rising labor costs.”

During the second week of April, occupancy increased by 2.4 percent to 69.9 percent. ADR rose 4.4 percent to $136.25 and RevPAR went up 6.9 percent to $95.22, in comparison with the same week of 2018. Also, meagre though the growth was, it continued a streak of RevPAR growth into its 108th month. That’s nearly as long as the longest overall expansion cycle in industry history, which lasted 112 months from December 1991 through March 2001.

The year’s first quarter also finished with positive results, albeit lower than forecasted, according to STR. Occupancy rose 0.4 percent to 61.8 percent, ADR rose 1.1 percent to $129.02 and RevPAR rose 1.5 percent to $79.68. Those are the highest first quarter results on record, and demand also outgrew supply, 2.4 percent and 2 percent respectively. Still, it was not as good as expected.

“First quarter performance came in lower than forecasted as the industry reported its lowest RevPAR percentage change for an opening quarter since 2010,” STR’s Senior Vice President of Operations Bobby Bowers said. “What made the quarter even more underwhelming was the fact that year-over-year results received a lift from the Easter calendar shift as well as significant group performance gains in San Francisco, which is benefitting from an influx of business at the reopened Moscone Center. Overall, San Francisco accounted for 40 basis points of that 1.5 percent increase in the U.S.”

For the month of March, San Francisco/San Mateo, California, posted the only double-digit increase in RevPAR, up 10 percent to $200.92, driven by the only double-digit jump in ADR, up 13.5 percent to $251.51.

Anaheim/Santa Ana, California, had the largest increase in occupancy, rising 2.9 percent to 82.4 percent. Other major markets slid, such as New York, New York’s double-digit decline in RevPAR, down 10.4 percent to $184.25, the result of a 7 percent drop in ADR to $218.98. Philadelphia, Pennsylvania-New Jersey, saw the largest decrease in occupancy, dipping 6.9 percent to 68.4 percent.

“On the whole, the top markets continue to underperform the rest of the country in year-over-year growth,” Freitag said. “New inventory entering those major cities is pulling occupancy levels down and further affecting hotelier pricing confidence.”

Things improved in mid-April somewhat.

Among the top 25 markets, Minneapolis/St. Paul, Minnesota-Wisconsin registered the highest increase in all the three key performance indicators.  Occupancy went up 9 percent to 73 percent, ADR rose 29.5 percent to $150.62, and RevPAR increased 41.1 percent to $109.98.

Chicago, Illinois, witnessed the second-highest rise in occupancy with an increase of 8.5 percent to 80 percent. The second-highest ADR and RevPAR, up 27 percent to $278 and up 34.7 percent to $251.46 respectively, were recorded in San Francisco/San Mateo, California.

However, New Orleans, Louisiana, which saw the second-highest lift in RevPAR in March, up 9.1 percent to $155.19, experienced the steepest declines in each of the three key performance metrics in April’s second week. The Big Easy’s occupancy was down 5.1 percent to 80.6 percent, ADR down 2.5 percent to $176.47 and RevPAR down 7.5 percent to $142.29.

The only other drop in ADR was recorded in Seattle, Washington, down 1.7 percent to $144.42. This resulted in the second steepest decline in RevPAR, down 6.5 percent to $100.30. The city also experienced the second-largest decrease in occupancy with 4.8 percent to 69.5 percent.