Occupancy levels are forecasted to fall in 2002 to their lowestsince 1971. Average daily rate, too, will feel the post-Sept .11effects, dropping to 1940 levels. An above-inflation rebound is notexpected until 2003, when upper demand growth, ADR, supply growthand upscale segments are all expected to upswing.

Not surprisingly, profit forecasts are down for 2002. Aggregateprofits are predicted to decrease for the first time since 1991,and lodging productivity should see a drop as room demand declinesoutpace lodging employee layoffs.

The increased delinquency trend within the industry is alsoexpected to continue. Standard & Poor's reports a 41% increasein late payments on lodging loans for October, compared topre-Sept. 11 levels. Most affected by the trend will be themidprice and economy sectors, which were already on a downturnprior to the attacks.