ATLANTA—The lodging industry in the United States will achieve 65% occupancy and will see demand for accommodations increase nearly 26% since the depth of the recession in 2009, according to a report authored by Atlanta-based PKF Hospitality Research.
The 65% occupancy level, if achieved, would be the highest since PKF began reporting on hospitality trends back in 1987. The firm also predicts that hoteliers will be able to increase their average daily rates at an average annual pace of 5.7% from 2015 through 2017.
“An ever-improving economy, and the favorable relationship between supply and demand, have led to significant growth in both revenues and profits from 2009 to the current year. We expect this trend to continue through 2017,” says R. Mark Woodworth, president of PKF-HR. “The 1990s were the only other time we observed such a sustained confluence of positive economic and market conditions.”
The bullish lodging report states that by year-end 2014 the vast majority of major markets will have surpassed their pre-recession levels of RevPAR. Several markets, including Seattle, Los Angeles, Houston, Pittsburgh, and Miami, will surpass their all-time record occupancy levels this year or next, PKF predicts.
“The best news for U.S. hotel owners and investors is that the combination of high occupancy levels and significant real ADR growth will perpetuate strong bottom-line gains. PKF-HR is projecting the current three year streak of double-digit gains in net operating income (NOI) to continue through 2016,” Woodworth noted. “We have not seen six years of such strong and sustained profit growth in the 78 years PKF has been tracking the U.S. lodging industry.”
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