The Norfolk-Virginia Beach MSA comprises several cities aside from Norfolk and Virginia Beach, including Chesapeake, Suffolk, Newport News, Hampton, Portsmouth, and Williamsburg. The region’s economy revolves around the federal government, the military, the aerospace industry, and the transportation, construction, and healthcare sectors.
The hospitality industry experienced many highs and lows across 2022 and as a sector, faced challenges including recovery from the pandemic, the impact of Russia’s invasion on Ukraine and the ongoing cost-of-living and energy crisis, the instability of government on the economy and rising interest rates. The sector has tried to remain resilient, in the knowledge some of these obstacles are continuing this year and will shape the outlook of the market as we progress further into 2023.
Spokane County’s current and under-construction offerings of sporting and event facilities continue to increase visibility for the market regionally and nationally. This article outlines the recent and upcoming changes to the county’s event facilities.
Lake Tahoe’s economy is anchored by the tourism industry, which experienced significant growth post-COVID given its proximity to major cities such as Sacramento, San Francisco, and Reno, as well as the array of outdoor activities. The Lake Tahoe Basin is home to a growing population of year-round residents, and the popularity of second homes and investment properties in the area has resulted in soaring home prices and an affordable housing crisis. To preserve the area's natural beauty, local governments and the Tahoe Regional Planning Agency have implemented strict development and short-term rental restrictions. Despite these restrictions, new lodging developments and redevelopments are underway, which are expected to reshape the mix of lodging supply going forward, particularly in the luxury segment.
With occupancy nearing the 70% mark and ADR levels approximately 4% above 2019 levels, the Denver lodging market achieved a RevPAR level in 2022 that was approximately $5 below 2019 levels. In line with the top 25 major metropolitan areas in the U.S., ADR has led the way in the recovery, with occupancy remaining below prior peaks.
The demand for travel during the American spring break timeframe is substantial—and demand remains strong despite higher prices. Let’s break down the expectations, pain points and opportunities for the industry.
Las Vegas’s 38.8 million total visitors in 2022 was roughly 91.3% of 2019 levels and only 4.1 million below the peak number of visitors in 2016. Gaming revenue for Clark County in 2022 was $12.8 billion, a new record for the market. Statistics from the Las Vegas Convention and Visitors Authority reflect 43.6 million total occupied room nights for Las Vegas in 2022, 20.6% more than in 2021. Occupied room nights, as well as total occupancy (79.2%), continued to lag 2019 performance, but the market’s ADR ($170.98) and RevPAR ($135.42) reached record levels in 2022. This article examines the latest trends and developments relevant to the Las Vegas hospitality market.
After the devasting impacts of Hurricanes Irma and Maria in 2017, the U.S. Virgin Islands, which comprise the islands of St. Thomas, St. John, and St. Croix, faced a significant rebuilding effort to reopen their hotel inventory. As the renovations and reopenings from the 2017 hurricane season were nearing completion, COVID-19 began to affect the islands. However, the U.S. Virgin Islands have a significant competitive advantage over the other islands in the Caribbean because they benefit from U.S. territory status. As a result, the U.S. Virgin Islands avoided the complicated COVID-19 travel restrictions that existed in other Caribbean destinations, allowing the islands to increase visitation numbers after 2020 significantly faster than other Caribbean islands.
Similar to the rest of the nation, hotel metrics in St. Louis plummeted in 2020 at the onset of the COVID-19 pandemic, but the market had entered a healthy recovery phase by the spring of 2021. Growth accelerated through the remainder of the year, fueled by a surge of leisure travel and the slow reemergence of commercial demand, as well as the return of conventions and major events.
Despite economic headwinds that have stoked fears of a recession in 2023, the hospitality industry continues to defy expectations and post strong numbers. Market performance of hospitality has exceeded other industries such as technology and retail, with the gap widening in the second half of the year.¹ Add the fact that revenue per available room (RevPAR) has exceeded GDP growth during the current economic cycle, and 2023 should be a good year for the hospitality sector.
The greater Tampa Bay lodging market is thriving, as evidenced by rising RevPAR levels, the entrance and subsequent absorption of significant new guestroom inventory, several high-profile transactions, and numerous exciting development projects in the market’s pipeline.
Philadelphia fans have an earned reputation for climbing light poles in celebration of major victories, other fanbases throw octopi on the playing surface, and still others jump through tables before the game is even played. Different fanbases behave differently. A statement that is acknowledged as anecdotally accurate but rarely discussed or fleshed out in a quantitative way. Using data from Placer.ai, HVS gathered data on fan behavior before and after games for every NBA, NFL, MLB, and NHL team and aggregated them by location to enable comparison. Los Angeles fans come from or go to their homes before and after games the most of any city, and use bars and restaurants the least. Nashville and Green Bay fans come from home before games or go home after games the least, and they are the most likely to be at a bar and restaurant before or after a game. The differences may be due to the location of stadiums and arenas and their proximity to entertainment centers, they may be due to the culture of a city, and they may be due to the different sports played in each city.
On February 12, Super Bowl LVII was held in Glendale’s State Farm Stadium with nearly 68,000 spectators. Attendance levels were just below the average for the last eight Super Bowls (excluding the COVID-19-affected year of 2021) and below the 2015 game’s 70,288 attendees, also in Phoenix. However, this year’s event did not disappoint the hotel industry in Greater Phoenix.
The final numbers came in and we did well. Occupancy and average rates were up and finished 2022 way up from 2021 and even 2019 in many markets. Our home market of San Diego finished at 72.6% occupancy and $203.50 average daily rate for a revenue per available room of $147.75! Recession? If it happens, we will not notice it. Sure, technology companies prospered while we suffered during the pandemic. But now, they are laying off tens of thousands of employees and we can’t find enough employees. We are not going to experience any pullback in business—it is our turn to have success while others retrench.
The oil and gas industry remains Greater Houston’s primary economic anchor, defining the market’s business cycle and the area’s economic growth path. The hotel market began to stabilize in 2019 following declines in lodging demand as a result of the volatility of the oil and gas markets, and Greater Houston experienced a steep decline in lodging demand in 2020 given the onset of the COVID-19 pandemic.
The Niagara Falls lodging market is rapidly recovering after the devastating pandemic-induced RevPAR decline of 72.9% in 2020. The market-wide RevPAR has reached 98% of the 2019 level in 2022 and is projected to reach 110% in 2023. ADR growth is leading the recovery. The cityscape is also poised for transformation over the next ten to twenty years through the addition of high-rise upper-upscale and luxury hotels, many as part of mixed-use developments.
The Detroit hotel market continued an upward trajectory in 2022 following a strong 2021. As illustrated below, RevPAR growth was driven by increasing average rates, with ADR exceeding pre-pandemic levels. Strong ADR levels were driven by Detroit’s tourism industry, which has shown the greatest recovery following the severe downturn in 2020 and early 2021. Visit Detroit reports that visitation numbers since the second quarter of 2022 have approached the pre-pandemic levels of 2019. However, occupancy growth has lagged the average for the U.S. and other top 25 markets in the Midwest, such as Indianapolis, Chicago, and St. Louis. This trend is primarily due to a slower recovery within the commercial segment, as workers have yet to return to offices in full force and international travel remains low.
Once again, Duetto has surveyed the global hotel industry to find out what are the burning issues of the day with revenue professionals.
No one would have bet on a return of performance to the level of 2019 as early as 2022, and this is what can only be described as a pleasant surprise. Many were looking further ahead and had underestimated many factors. MKG Consulting's 2021 business forecast was below the performance seen this year and yet it was met with scepticism. In reality, these forecasts, which were considered very optimistic, have been exceeded.
When Disneyland Resort, Anaheim’s crown jewel, was forced to close in 2020 at the onset of the COVID-19 pandemic, area hotels faced some of the greatest demand losses in the nation. The park system welcomed back its local fanbase in 2021 with the introduction of a new reservation system. Once Disney attendees were more familiar with the park’s new reservation system, which requires advance planning and makes it more difficult to book same-day tickets, leisure demand rebounded, spurring double-digit ADR growth in 2021 and 2022.
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