Declining U.S. lodging demand will end in Q2 2010
PKF Hospitality Research (PKF-HR) today announced that, according to an advance release of the September 2009 edition of Hotel Horizons®, nine consecutive quarters of declining lodging demand will come to an end in the second quarter of 2010.
Hotels that operate in the luxury, upscale, and midscale without Food & Beverage segments are expected to more customers beginning to re-appear in the fourth quarter of 2009. “While the price paid for the room will remain the most important criteria for most travelers in 2010, the value received will once again factor into the buying decision” Woodworth noted. “Higher-priced hotels have suffered the greatest erosion in pricing power during this protracted contraction and, as a result, offer an abnormally strong value proposition as the industry begins to turn the corner mid-way through 2010. We also believe that those property types that were the best performers before the recession are going to be those leading us out.” The two chain scales lagging the U.S. demand recovery will be midscale with Food & Beverage and economy, which will not see improved performance until the third quarter of 2010.
“Of the 50 markets monitored by PKF-HR, 45 will experience stronger demand in 2010 than in 2009,” Woodworth added. “It is important to note, however that supply increases are still an issue for hoteliers across the U.S., as 25 of our 50 markets will report further declines in occupancy, even with 20 of those 25 experiencing demand increases.” The five lagging markets are Fort Lauderdale, Indianapolis, Miami, Tampa, and Washington, D.C.
Budgeting Accuracy – What We Learned In 2002 & 2003
Hotel Horizons® is a series of econometrically derived forecast reports developed by PKF Hospitality Research. The reports cover 50 of the largest U.S. hotel markets as well as the nation as a whole, and six chain scales. Economic forecasts by Moody’s Economy.com and historic hotel performance data and future supply pipeline information from Smith Travel Research are used to construct the industry’s most comprehensive forecasts of U.S. lodging market behavior.
PKF Hospitality Research is introducing a new tool called myShareSM which helps managers incorporate the current PKF-HR forecast for their market into an estimate of the future performance of any submarket, competitive set, or their hotel. Included as a complimentary addition to all single market Hotel Horizons® reports, the myShareSM tool is an Excel-based application that comes pre-loaded with the respective Hotel Horizons® forecasts for all hotels, upper priced, and lower priced properties within a defined geographic market, as well as historic submarket data from which to assist the user in calibrating penetrations. For more information, as well as a video demonstration of myShareSM, go to
To purchase Hotel Horizons® forecast reports for the United States, or one of 50 individual markets, please visit the firm’s online store at , or call (866) 842-8754.
Mark Woodworth (CBRE)
Senior Managing Director
Phone: +1 404 812 5085