TravelClick: Leisure Travel Key to Hotel Growth in '14

THE PULSE: Leisure travel is booming and will increase dramatically in the next 12 months, according to booking data from TravelClick 

WHY IT RATES: Expect to see increased leisure travel in the warm spring and summer months as the economy improves and more travelers continue to mix business with pleasure.

The hotel industry saw a healthy start to the year and is continuing to show gains in both demand and average daily rate (ADR), according to data from the April 2014 TravelClick North American Hospitality Review (NAHR). The transient segment, which is made up of individual business and leisure travelers, is leading the charge, with particularly sharp increases in the leisure travel segment for the next 12 months.

“TravelClick’s data reveals that the vast majority of the 25 major North American markets we track are seeing steady, moderate growth in both occupancy and ADR,” said Tim Hart, Executive Vice President, Business Intelligence, TravelClick. “The transient sector continues to outperform the group sector, with leisure travel showing really impressive gains.”

12 Month Outlook (April 2014 – March 2015)

For the next 12 months (April 2014 – March 2015), overall committed occupancy* is up 4.4 percent when compared with the same time last year. ADR is up 2.8 percent based on reservations currently on the books.

Transient bookings are up 7.7 percent year-over-year and ADR for this segment is up 4.8 percent. When broken down further, the transient leisure (discount, qualified and wholesale) segment is showing occupancy gains of 9.6 percent and ADR gains of 5.9 percent. The transient business (negotiated and retail) segment is up 4.8 percent with an ADR increase of 3.8 percent. Group segment occupancy is ahead by 3.1 percent and ADR is down 0.1 percent, compared to the same time last year. 

Hart added, “There are a number of holidays – including Easter and Passover – as well as the start of summer vacation that take place in the second quarter. This confluence of events is a key driver for leisure growth in the quarter as families take advantage of the warm weather, holiday breaks, and the strengthening economy to book vacations.”

The April NAHR looks at group sales commitments and individual reservations in the 25 major North American markets for hotel stays that are booked by March 31, 2014, for the period of April 2014 to March 2015. 

*Committed Occupancy – (Transient rooms reserved + group rooms committed)/capacity

**Reserved Occupancy – Total number of rooms reserved/capacity

The Second quarter combines historical (April) and forward looking data (May – June)

SOURCE: TravelClick press release