Caribbean Hotel Update: Two Markets Showing High Levels of Occupancy Recovery
The summer travel season, helped by growing vaccination rates around the world, allowed Caribbean hotels to pick up steam in their road to recovery.
Regardless of world region, the markets that truly stand out are those with favorable comparisons to 2019—the last “normal year” prior to the pandemic. In the Caribbean, we have been comparing 2021 vs. 2019 data for year-to-date periods to remove the effects of seasonality, which are usually substantial in the region. As of August, we saw two of 14 markets with hotel occupancy near or above the 2019 comparable.
The only Caribbean market to achieve an August year-to-date occupancy level higher than its 2019 comparable was the U.S Virgin Islands. The market reported an occupancy of 73.4% through the first eight months of the year, which was 8.4% higher than the same period in 2019.
Puerto Rico reported a 64.9% occupancy level, which came in relatively close to the 2019 comparable (68.1%). Prior to August, the market had seen eight consecutive months of occupancy improvement, with July occupancy even surpassing the same month in 2020, 2019 and 2018. Despite a month-over-month decline in August, Puerto Rico’s occupancy remained similar to levels seen earlier in the summer.
The U.S. Virgin Islands and Puerto Rico have benefitted from the U.S. corridor and the fact that U.S. travelers do not need a passport or a different currency. Additionally, domestic tourism in Puerto Rico is quite popular and has carried this market through the COVID-19 storm.
Another market that performed closer to its 2019 comparable was Turks and Caicos. Occupancy came in at 59.7%, which was 12.7% below the 2019 comparable (68.4%).
While other Caribbean markets hang on the tail of their 2019 comparables, some markets, such as the Cayman Islands, remain far off from achieving similar 2019 levels. The market reported a 42.6% August year-to-date occupancy level, which was down 72.3% from its 2019 comparable.
Overall, the Caribbean registered a 39.5% year-to-date occupancy level, down 41.4% from 2019. As shown in STR’s School Break Report, a majority of U.S. K-9 and college students returned to school by mid-to-late August, with some students set for a fall break weekend in mid-October. While travel to the Caribbean is possible, we have seen that travelers often spend those longer weekend trips at drive-to destinations. Add in hurricane season to the mix, and September and October tend to be the slower months for the Caribbean. However, since pent-up demand is still existent, we could see higher performance figures before winter season kicks in.
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STR provides premium data benchmarking, analytics and marketplace insights for the global hospitality industry. Founded in 1985, STR maintains a presence in 15 countries with a corporate North American headquarters in Hendersonville, Tennessee, an international headquarters in London, and an Asia Pacific headquarters in Singapore. STR was acquired in October 2019 by CoStar Group, Inc. (NASDAQ: CSGP), the leading provider of commercial real estate information, analytics and online marketplaces. For more information, please visit str.com and costargroup.com.