IRVING, TX-In a revised projection for the Q3, FelCor Lodging Trust is bracing for a 17% RevPAR drop from the same reporting period in 2000. The good news is that FelCor’s hotel occupancy is picking up.

Thomas J. Corcoran Jr. made the Q3 assessment in a teleconference hosted by Deutsche Banc Alex Brown. In the annual “Global High Yield” virtual conference, Corcoran said hotel occupancy levels have shown moderate improvement from the sharp lows resulting from the Sept. 11 terrorists’ attacks. A 17% RevPAR decline appears to be looming, but it’s down industrywide as everyone knows. FelCor’s RevPAR dipped 10.1% in July, 11.6% in August and 31% in September, according to the REIT. The lowest point was recorded Sept. 16. “Since that time, hotel occupancies have begun to rebound on a daily basis and trends continue to be encouraging,” Corcoran says.

In the third week of September, FelCor recorded an overall 54% occupancy, up six points. On Sept. 29, it was 62%. “America is getting back to business,” Corcoran assesses in a prepared statement. The September level approximates FelCor’s break-even cash flow after interest costs, he adds.

FelCor shareholders were forewarned of a Q3 earnings revision when the REIT axed a planned merger with Washington, DC-based MeriStar Hospitality. Corcoran wasn’t available for an interview, but his prepared statement strongly indicates that something is being kicked around for late 2002. After the merger cancellation, Corcoran told that it was too early to say if the deal would be resurrected. The immediate focus was for both companies to regroup from the industry’s setbacks, MeriStar did just that in a management shuffle.

FelCor’s per key asset value is now $65,000 instead of the usual $100,000, according to estimates. “We believe there has been an over-reaction in the equity markets to September’s softening in lodging demand and there will be substantial opportunities for FelCor by late 2002,” he says, without elaborating.

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

Once you are an ALM digital member, you’ll receive:

  • 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

*May exclude premium content
Already have an account?


© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.



Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join now!

  • Free unlimited access to's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including and

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2023 ALM Global, LLC. All Rights Reserved.