MAY WAS OVERALL a good month for the U.S. hotel industry. Bouncing back from the negative turn in April, May recorded a 2 percent increase in profits per room over the same time last year, according to HotStats.
The GOPPAR recorded in May was at $112.80, an increase of 4.7 percent over the year-to-date GOPPAR figure of $107.73. It was almost $6 below the April’s profit level at $118.51.
There also was a significant acceleration in costs, including a 4.7 percent year-over-year increase in payroll to $97.49 per available room.
The month saw revenue growth across all departments, with year-over-year revenue increases recorded in food/beverage, up 3.5 percent, and conference/banqueting, up 2.4 percent, on the per-available-room basis.
TRevPAR increased 3.4 percent to $283.54 because of the growth across rooms and non-rooms.
“Despite resuming growth in revenue this month, hoteliers in the U.S. are reminded to keep an eye on creeping costs and their impact on profit,” said David Eisen, HotStats’ director of hotel intelligence and customer solutions, Americas. “Payroll, for one, continues to be a thorny issue that hoteliers need to stay vigilant on.”
San Francisco witnessed a 4.2 percent year-over-year increase in TRevPAR to $355.83. Payroll was up 9.3 percent year-over-year to $147.77 on a per-available-room basis. It was equivalent to 41.5 percent of total revenue and thus effectively eradicated the profits.
After a challenging period of operations in recent years, the city’s RevPAR increased 5.7 percent to $259.32. The decrease in GOPPAR was 1.6 percent to $129.37.
Los Angeles hotels also suffered a 4.7 drop in GOPPAR to $81.66, making it the third consecutive month with heavy profit decline. The Payroll levels increased by 5.4 percent year-over-year to $102.47 and the uptick in labor canceled out the 1.4 percent increase in TRevPAR.
Last month HotStats reported that 2018 was a strong year for U.S. hotels, but warned that discipline would be needed to maintain the momentum in 2019.