It might not be a surprise to hear that the pandemic has effectively shutdown the hospitality market, but now that we were seven months into the pandemic and the travel shutdown, the impact is clear. Since March, occupancy rates have plummeted and ADR declined in step, according to a mid-year report from Integra Realty Resources. In addition, transaction volumes fell dramatically, mimicking the lowest points of transaction volumes in the previous recession.

Occupancy rates began to fall almost immediately in late February following the mandated shutdown of travel and businesses. In March, US hotel occupancy rates fell to 39%, a 63% decreases compared to March 2019, according to the report. March was only the beginning. Occupancy rates have continued to decline in April to 24%; however, occupancy began to increase again in May and June, rising to 33% and 46% respectively.

In addition, ADR has decreased in step with occupancy, but at a slower pace. ADR decreased 16% compared to 2019 in March and another 56% in April to $73.31. However, like occupancy, rates increased in May and June to $95.37. Still, rates are significantly lower compared to 2019. In June 2019, when rates were $134.10, according to the report. Of course, the combination of declining ADR and occupancy meant a sharp decrease in RevPAR. Like ADR and occupancy, RevPAR rates bottomed out in April before beginning to increase again in May and June when RevPAR hit $44.03. By comparison, June 2019 had a $98.14 RevPAR rate.

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.