With the COVID-19 pandemic effectively halting tourism around the world, hotels are facing a rough year with extraordinarily low occupancy rates. In the U.S. specifically, STR and Tourism Economics predict that RevPAR will drop 50.6 percent this year.
STR had originally expected occupancy to only drop 0.3 percent before the United States declared a nationwide emergency. Supply and demand had been expected to increase by 2 percent.
Now, according to Travel Weekly, occupancy is expected to fall by 42.6 percent to 37.9 percent while supply and demand may drop 14.9 percent and 51.2 percent, respectively.
"The industry was already set for a nongrowth year; now throw in this ultimate 'black swan' event, and we're set to see occupancy drop to an unprecedented low," said Jan Freitag, STR's senior vice president of lodging insights. "Our historical database extends back to 1987, and the worst we have ever seen for absolute occupancy was 54.6% during the financial crisis in 2009."
While STR saw the steepest U.S. RevPAR decline in 30 years the week of March 21, Tourism Economics remains optimistic that the hotel industry will see a quick rebound once the pandemic is over. The president of Tourism Economics, Adam Sacks, predicts "the market to begin to regain its footing this summer."
STR and Tourism Economics expect that U.S. hotel RevPAR will increase 63.1 percent in 2021, with occupancy increasing 57.3 percent to 59.7 percent and supply and demand increasing by 15.6 percent and 81.8 percent respectively.
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