Lower-Tier Extended Stay Outperformed Other Lodging Segments in 1999

The lower-tier extended stay segment outperformed all of the other eight brand segments of the lodging industry in RevPAR growth, and it significantly outperformed its two most closely related sectors: budget and economy. The budget sector showed a 4.0 percent year-over-year gain in RevPAR growth in 1999; the economy sector recorded a 0.4 percent gain in RevPAR growth.

"The lower-tier extended stay segment has the most favorable demand-supply balance of any segment in the industry at the current time. Its occupancy rate of 68.6 percent in 1999 represented a 19 point premium over break-even occupancy, the widest margin among all brand segments. The sector's solid performance should continue throughout 2000 with the continued strength of the economy, a further slowing of supply growth, and rising occupancy levels," said Bjorn Hanson, Ph.D., global industry leader, PricewaterhouseCoopers.

PricewaterhouseCoopers is the industry's leader in providing reliable lodging fundamentals and lodging forecasts research forecasts that offer true industry-wide samples based on solid econometric models. The group predicted every industry turning point in the last ten years.

The firm's research models have recently been refined and enhanced to improve the estimation of future room starts, to enable more precise estimation of the interactions between lodging statistics and the macroeconomy, and to provide reliable estimates of future lodging statistics of the U.S. at the industry segment, the regional, and the local market level.

PricewaterhouseCoopers acquired PKF Consulting Ltd. (Asia/Pacific) on July 26, 1999. The acquisition places PricewaterhouseCoopers in a leading position in the Asia market. The group also recently formed a partnership with Smith Travel Research, and will introduce lodging market summaries across Europe and Asia in coming months in its WWWSTAR program.

PricewaterhouseCoopers Hospitality and Leisure Group provides services including management, technology, human resources and financial consulting in North America, Europe, the Middle East, Africa and Asia.

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