STR forecast: U.S. Supply growth to stifle RevPAR in 2010
Looking at the third and fourth quarters of 2009, decreases will slow in occupancy and demand percent change when compared with the later part of 2008. November is the only month with expected demand growth in year-over-year comparisons.
“Our slight downward revision in the 2010 U.S. lodging RevPAR forecast is due to the higher supply growth number we now expect next year,” said Mark Lomanno, president of STR. “That upward adjustment is the result of the significant decline in the number of hotel rooms that are actually closing their doors in this economic cycle. Our previous assumptions for room closings were substantially higher than we now expect.”
The outlook for 2010 looks slightly better than 2009, but the industry is expected to end 2010 with decreases in all three key metrics. Occupancy is projected to end the year with a 0.6-percent decrease at 55.1 percent, ADR is forecasted to decline 3.4 percent to US$93.16, and RevPAR is expected fall 4.0 percent to US$51.26.
Supply and demand in 2010 are both projected to end the year with positive growth. Supply is predicted to be up 1.8 percent and demand is expected to increase 1.3 percent.
STR provides clients from multiple market sectors with premium, global data benchmarking, analytics and marketplace insights. Founded in 1985, STR maintains a presence in 16 countries with a corporate North American headquarters in Hendersonville, Tennessee, and an international headquarters in London, England. For more information, please visit str.com.