Markets & Performance USA & Canada Opinion Articles - Hospitality Net

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Opinion Article

April 29, 2020

An Updated 2020 Outlook - Expectations for the Year Ahead

Economic conditions are deteriorating quickly and according to Oxford Economics, theU.S. economy is in recession. Oxford predicts that, "the coronavirus pandemic will lead to a profound, pervasive, and persistent, but not permanent reductions in activity, with widespread cuts in social spending, severe disruptions to supply chains, and major interruptions in travel and tourism activity."

By Jamie Lane, Sr. Director, Economics & Forecasting, CBRE Hotels

Opinion Article

April 23, 2020

Horwath HTL - 2019 USA Hotel Market - Trends & Analysis Report

The U.S. hotel industry was already set for a non-growth year. Real GDP growth, almost always a reliable indicator of hotel performance, had decelerated in 2019 for the first time in a decade due to weak capital spending, increased tariffs and slowing global growth. Similarly, 2019 RevPAR growth had decelerated from its 10-year average of 3.2% to 0.9%.

By Michael Cummings and Richard Keegan

Opinion Article

April 21, 2020

Impact of COVID-19 on Los Angeles & Southern California Hotel Markets

Since December 2019, outbreaks of coronavirus (COVID-19) have led to global economic disruptions as cities and countries attempt to slow the spread of the disease by implementing lockdowns and social distancing measures. At the time of publishing this article, the number of cases in the United States and California exceeded 680,000 and 28,000, respectively. The federal government, along with state and local governments, has implemented restrictions to slow the spread of the disease, including stay-at-home or shelter-in-place orders.

By Luigi Major, Managing Director, Advisory of HVS Americas, HVS

California, United States

Opinion Article

April 20, 2020

Operating Performance At Low Occupancy Levels

Since January 2020, CBRE Hotels Research has been analyzing the impact of the COVID-19 virus to understand how the societal and economic impacts of COVID-19 will influence the performance of U.S. hotels.

By Robert Mandelbaum, Director of Research Information Services, CBRE Hotels

Opinion Article

April 17, 2020

HVS COVID-19 Impact on Lodging Tax Revenues

HVS modeled the anticipated RevPAR declines during the COVID-19 pandemic. Based on patterns of recovery following the two most recent recessions, we projected the lodging tax revenues of 24 urban markets in the United States. Comparing these projections to a baseline scenario without the pandemic, HVS estimates combined losses of 24 major U.S. markets could range from $4.0 to $5.5 billion of lodging tax revenues. Lodging tax losses of this magnitude will force bondholders, destination marketing organizations, and other stakeholders to consider steps such as debt refinancing or seeking alternative revenue streams until the hospitality industry recovers from this pandemic.

By Thomas Hazinski and Joseph Hansel

Opinion Article

April 16, 2020

Putting the Past to Use Redux - Expense Elasticity in a Downturn

Like restaurants and airlines, hotels offer experiential, temporal products that cannot be inventoried. The COVID-19 pandemic has temporarily reduced hotel demand to near zero; meanwhile, inventory continues to stream into the void unused. Thus, the hotel industry is experiencing unprecedented year-over-year hotel revenue losses. How long the direct impacts will continue remains to be seen, as does the collateral long-term impact; however, a significant RevPAR loss in 2020 is certain, and most experts expect post-pandemic results to remain below the pre-crisis benchmark year of 2019 for several years.

By Erich Baum, Senior Vice President, HVS

Opinion Article

April 16, 2020

Examining changes in RevPAR, profit in past recessions

CBRE Hotels Research was projecting a 1.1% increase in revenue per available room for the year. Even with this low level of revenue growth, there were certain factors that could have sustained—or at least cushioned the blow of minimal declines—the nine-year trend of profit growth for U.S. hotels since 2010.

By Robert Mandelbaum, Director of Research Information Services, CBRE Hotels

The next-gen metrics that move hotel P&L

Hotel tech has changed what's possible – and measurable. RevPAR and ADR aren't enough; discover the metrics that really matter.

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Why Hospitality Net Leads B2B in Hospitality

Learn what makes us the industry-leader in what we do.

Hospitality Net

Opinion Article

April 8, 2020

Boston & Cambridge Lodging Market: COVID-19 and Its Impact on Supply

Life across the United States has changed dramatically in the last four weeks. In Boston, and almost every other city in the country, hotel owners and operators have been forced to make the difficult decision to close temporarily while the country attempts to slow and contain the spread of COVID-19. In Massachusetts those decisions were partially made for them on March 31st.

By Sebastian Colella, Vice President, Pinnacle Advisory Group

Boston & Cambridge, Massachusetts, United States

Opinion Article

April 7, 2020

Will Airbnb guests want to stay in chain hotels instead when the pandemic is over?

COVID-19 hit the economy so hard that it could take three years for the U.S. to recover.

By Linchi Kwok, Professor and Department Chair, Cal Poly Pomona

Opinion Article

April 2, 2020

U.S. Hotels Changes in RevPAR and Profits During Historical Recessions

The U.S. lodging industry was prepared for a slowdown in performance entering 2020. CBRE Hotels Research was projecting a 1.1 percent increase in RevPAR for the year. Even with this low level of revenue growth, there were certain factors that could have sustained - or at least cushioned the blow of minimal declines - the nine-year trend of profit growth for U.S. hotels since 2010.

By Robert Mandelbaum, Director of Research Information Services, CBRE Hotels

Opinion Article

March 27, 2020

Boston & Cambridge Lodging Market: Coronavirus Causing Steep Demand Declines, Closures, Layoffs

As travel across the country and the world has all but stopped the last few weeks from the threat of COVID19, hotels across the country saw an unprecedented amount of cancellations. The Boston lodging market has been one the hardest hit markets in the United States with demand declining dramatically throughout most of March.

By Sebastian Colella, Vice President, Pinnacle Advisory Group

Boston & Cambridge, Massachusetts, United States

Opinion Article

March 12, 2020

After A Decade Of Growth And Recovery, What’s Next?

Looking back at the past always helps to give an indication of what the future may hold. The hotel industry has shown tremendous growth in all metrics since 2009.

By Joseph Pierce, Director of Appraisal & Consulting Services, Hotel & Leisure Advisors (H&LA)

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Why Hospitality Net Leads B2B in Hospitality

Learn what makes us the industry-leader in what we do.

Hospitality Net

Opinion Article

March 2, 2020

HVS Market Pulse: Detroit, MI

The Motor City continues to benefit from an improved reputation driven by development efforts among economic power houses such as Ford, Fiat Chrysler America (FCA), and General Motors (GM). However, Detroit's economy has become more diverse since the economic lows of 2013 when the City filed for bankruptcy. The financial, healthcare, and education sectors have solidified their presence, while the technology sector has become a focus of growth.

By Brandon Leversee, Vice President with HVS Detroit, HVS

Detroit, Michigan, United States

Opinion Article

February 28, 2020

HVS Market Pulse: Cape Cod

As with most leisure markets, particularly those driven by weather, the Cape Cod market has a high degree of seasonality. In the last three years, peak-season August occupancy levels have averaged in the mid-80s, while low-season January occupancy levels have averaged in the low 20s. Both local hoteliers and the Cape Cod Chamber of Commerce have been mildly successful in expanding shoulder seasons in April, May, September, and October.

By Roth Johnson, Project Manager with HVS Boston, HVS

Cape Cod, Massachusetts, United States

Opinion Article

February 27, 2020

HVS Market Pulse: Minneapolis-St. Paul Lodging Market Perceptions

For this article, we will focus on three major submarkets within the Twin Cities metro area: Minneapolis, St. Paul, and Bloomington. These three cities host the largest inventory of hotel rooms, and each offer their own unique amenities and demand generators necessary for the successful operation of a hotel.

By Justin Westad and Tanya Pierson

Minneapolis-St. Paul, Minnesota, United States

Opinion Article

February 25, 2020

Amazon in Music City: The Anticipated Impact on the Lodging Industry

Following a nearly year-and-a-half Request for Proposal (RFP) process, Amazon announced that it would split the location of its new HQ2 campus between Long Island City, New York, and Crystal City, Virginia. The company also unexpectedly announced an additional, smaller office called the Center for Operational Excellence in Nashville, Tennessee. Following intense pushback from residents and local politicians in NYC, Amazon withdrew from Long Island City, which left just Crystal City in Virginia as the company's new HQ2 location.

By Marc Greeley and Benjamin Levin

Nashville, Tennessee, United States

Opinion Article

February 24, 2020

HVS Central Florida 2020 State of the Hotel Market

Orlando has long been distinguished as an iconic vacation destination by continuing its ranking as the No. 1 destination in the United States, according to Visit Florida. Since 2013, Orlando has reigned as the nation's "Most Visited Tourist Destination." With multiple factors driving Orlando's appeal, hotel investors and developers are curious as to what is on the horizon for the hospitality market in Central Florida.

By Donald C. Stephens Jr., Managing Director of HVS Orlando Consulting & Valuation, HVS

Florida, United States

Opinion Article

January 29, 2020

HVS Market Pulse: Kalispell and Whitefish, Montana

Due to Kalispell's proximity to Glacier National Park, the region's local economy is largely tied to tourism and is highly seasonal. Kalispell is home to 22 open and operating hotels, encompassing 1,885 guestrooms. Of those 22 hotels, four of them (totaling 348 guestrooms) have opened in the last six years, accounting for an 18% increase in hotel rooms in less than a decade. These new properties include a SpringHill Suites by Marriott, Country Inn & Suites by Radisson, and MyPlace, which opened in 2016, 2018, and 2019, respectively. The property types in this market range from economy to upscale, as outlined in the table below.

By Desiree Flanary and Lauren Reynolds

Kalispell and Whitefish, Montana, United States

Opinion Article

January 23, 2020

Do Dual-Branded Hotels Outperform Single-Branded Hotels?

Dual branding of hotels has become a growing industry practice. Beyond the potential marketing benefits of the dual-branding strategy, this paper tests whether dual-branded hotels operate more efficiently than comparable single-branded hotels (and therefore deliver better bottom-line results). Comparing a proprietary longitudinal data set on the operating performance generated by dual-branded hotels in the U.S. against a set of comparable single-branded hotels, we document mixed results.

By Chekitan S. Dev and Eva Steiner

Opinion Article

December 30, 2019

2019 HVS Performance Report: Spa Department

On average, spa and wellness departments run profitably and can contribute significantly to a hotel's bottom line. This report is our second annual performance report published by HVS that tracks and monitors spa department performance and profitability. The data presented reflect spa operating-statement averages and data points from 2018 through the third quarter of 2019.

By Rodney Clough, President - HVS Americas, Denver, HVS