As host of the NCAA men’s basketball Final Four, Phoenix’s hotel market was poised for a championship performance. But how did Phoenix’s 2017 Final Four weekend compare to hotels in cities that hosted the event in the past few seasons?
HENDERSONVILLE, Tennessee—While the North Carolina Tar Heels hoisted the 2017 NCAA men’s basketball championship trophy and found redemption from their 2016 runner-up finish, the Phoenix hotel market also had a championship performance as the city hosted March Madness’ Final Four weekend.
Historically, hotel markets of Final Four host cities perform exceptionally well. Looking at the men’s tournament for the past five years, we noticed a significant increase across the key performance indicators during a four-day stretch from Friday—the night before the Final Four semifinal games—through Monday—the night of the championship.
The chart below shows the growth rates during the last six NCAA men’s basketball Final Four weekends. We aggregated the four days of the Final Four weekend (Friday through Monday) and compared that to a baseline of the average of every weekend (Friday through Monday) for the prior year.
Phoenix hotels experienced a 29% occupancy increase during the 2017 Final Four weekend, and a 76% average-daily-rate increase drove revenue per available room up 127%. The average RevPAR increase in the other Final Four host markets was a little more than $68 during the weekend, whereas Phoenix attained slightly less than a $100 increase.
Hotel demand during Final Four weekend for the past five years has increased by an average of 37.5%. Phoenix posted below-average demand growth during its turn as Final Four host, as demand increased by 31%. On Friday and Saturday, Phoenix hotels showed roughly the same demand growth as the other host markets, but it did not have the same pickup for Sunday and Monday.
We then calculated the difference in hotel revenue generated during the Final Four weekend compared to an average four-day weekend.
On average, a host of Final Four weekend from 2012 to 2016 achieved a hotel revenue increase of $19.5 million, ranging from $14.7 million to $23 million. This is a $4.9-million increase per day on average. Hotels in Phoenix reported significant revenue gains during the weekend by bringing in an additional $25.9 million, which is almost $6.5 million a day over their typical period of Friday through Monday.
Although Phoenix wasn’t the top-performing hotel market of the last six hosts of the NCAA men’s basketball Final Four, the market’s hotels were still able to achieve a phenomenal four-day weekend of positive performance.
This article represents an interpretation of data collected by STR, parent company of HNN. Please feel free to comment or contact an editor with any questions or concerns.