Source: CoStar Group
By Sean McCracken
January 26, 2021
For the U.S. hotel industry, 2021 is expected to be significantly better than 2020 but still much worse than 2019, according to the latest forecast from STR.
STR is Hotel News Now’s parent company and a division of CoStar Group.
During the “Hotel Performance Outlook” session of the ALIS Winter Update online conference, STR President Amanda Hite said her company’s analysts have slightly downgraded their outlook for full-year 2021, pushing occupancy projections below 50% for the year.
Hotel occupancy for the year is forecast at roughly 75.9% of 2019 levels; ADR is expected to reach 82.1% and RevPAR 60.7% of 2019 levels.
“We think that’s pretty reasonable given that we don’t expect the rebound to begin meaningfully until the middle of the year,” she said. “Certainly, there’s upside as the virus grows more under control and more vaccinations are happening. So, we do anticipate that we’ll see a new annual record for demand in 2023.”
Hite said the ongoing pandemic has forced STR to consider metrics the company never thought would be relevant to hotel industry forecasting, notably the percentage of the U.S. population that has received a COVID-19 vaccine.
As of Jan. 20, just 4.3% of the population was vaccinated, she said.
“There’s still a long way to go to get to that 60% mark (the Centers for Disease Control and Prevention) are targeting by June,” she said.
She said in the final 10 months of 2020, the industry lost out on $83.9 billion in revenues, which is a significantly larger hit than the fallout from the Great Recession, when roughly $16.9 billion was lost over a 19-month period.