For those worried about the Ebola outbreak affecting the U.S. hotel industry, the latest performance report from STR, Inc. suggests to curb your fears.
The report recorded historic increases in occupancy, average daily rate (ADR) and revenue per available room (RevPAR) year-over-year for U.S. hotels in the third quarter of 2014.
Occupancy increased 3.8 percent to 70.3 percent, ADR jumped 5.2 percent to $117.91 and RevPAR spiked 9.2 percent to $82.93.
"Third-quarter RevPAR growth of 9.2 percent was the highest quarterly growth rate since the first quarter of 2006 and the highest third-quarter growth STR has ever recorded," said Bobby Bowers, senior VP of operations at STR, via a press release. "The strong RevPAR increase was driven primarily by ADR; occupancy also increased at a healthy 3.8-percent clip. Third-quarter occupancy was the highest quarterly occupancy number since the third quarter of 1997. STR anticipates full-year 2014 U.S. industry RevPAR growth of around 7 percent."
Demand also increased 4.8 percent during the third quarter, while supply jumped 0.9 percent.
Interestingly enough, Atlanta, one city where fears could be heightened (Hartsfield-Jackson International Airport is one of five U.S. airports screening passengers arriving from West Africa for Ebola), experienced the greatest increase in occupancy year-over-year among the top 25 markets (up 9.8 percent). New Orleans registered an occupancy increase of 9.1 percent.
Five markets achieved double-digit ADR increases: Seattle, Washington (up 13.2 percent to $158.70); Nashville, Tennessee ( up 11.9 percent to $115.63); Denver, Colorado (up 11.8 percent to $119.47); San Francisco/San Mateo, California (up 11.1 percent to $226.92); and Boston, Massachusetts (up 10.8 percent to $186.52).
New Orleans recorded the greatest RevPAR spike, rising 18 percent to $79.35. Five other markets experienced RevPAR increases of more than 15 percent: Nashville (up 17.3 percent to $86.67); Atlanta (up 17.2 percent to $67.88); Seattle (up 16.2 percent to $141.96); Denver (up 15.9 percent to $102.03); and Boston (up 15.6 percent to $162.16).
Once again, Atlanta was among the top performers, making it a leader in two of the three key performance metrics.
Another notable tidbit: None of the top markets saw a decrease in any of the three key performance metrics during the third quarter.
This backs up projections by Mark Woodworth and Jamie Lane of PKF Hospitality Research in a recent Hotel News Now column that the Ebola scare doesn't figure to affect the travel industry. These projections took into account the potential (or lack thereof) of public perception exceeding the actual risks of the disease, as written about on TravelPulse.
The extensive (in some cases, dramatized) coverage of Ebola doesn't appear to have hurt the travel industry so far. Part of the reason, as Woodworth and Lane suggested, is because news organizations have generally done a good job of conveying accurate information about Ebola (transmission, symptoms, small number of isolated incidents in the U.S., etc.) that has in turn eased fears.
Travelers appear to be up to speed on the actual risks of Ebola in the U.S., which is good news for hoteliers and the travel industry as a whole. The recent results from STR prove it.
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