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NEW YORK CITY-The lodging industry’s sagging numbers have continued to deteriorate since the events of September 11, prompting Ernst & Young’s Hospitality Services Group to revise its already-tepid 2001 forecast.

January predictions included growth in the national Revenue Per Available Room–a key hotel-performance indicator–of 3.7% or $56.33. The revised, post-attack projection is a decline of 5.2%, for an overall 2001 RevPAR of $51. E&Y says occupancy is also sliding a slippery slope, with the 63.7% January prediction now modified to reflect an anemic 60.5% occupancy rate, down 3.2% from last year.

The Average Daily Rate forecast has also dipped since January, from $88 down to $85 for the year, on the assumption that hotel operators will be forced to slash rates to attract customers. Business travel is expected to recover first as convention business, severely curtailed in September, gets back on schedule.

“The industry finds itself in a great challenge,” says E&Y national director of hospitality services Chase Burritt. “Most of our clients are projecting significant revenue declines and cost overruns. The combination of the economic slowdown and tragic events of September 11 have led to the worst occupancy we’ve seen in 10 years.

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