Despite a favorable calendar shift for the holiday, U.S. hotel performance for the week ending 4 July showed a decline in the number of roomnights sold from the prior week.
HENDERSONVILLE, Tennessee—Revenue-per-available-room declined 44.8% for the week ending 4 July, marking continued improvement in the metric, largely due to a favorable calendar shift for the July Fourth holiday.
Jan Freitag, SVP of lodging insights at STR, said July Fourth fell on a Thursday in 2019, “severely curtailing group and transient corporate demand, which means that this year, the week of July Fourth was a much easier comparable.” (STR is the parent company of Hotel News Now.)
However, he said it wouldn’t be surprising if data for the week ending 11 July shows RevPAR reverting to a decline of 50%, similar to the week ending 27 June. The number of new COVID-19 cases continues to spike in some parts of the U.S., which will have “huge implications on the U.S. hotel industry going forward,” he said. The U.S. reported just under 350,000 new cases for the week ending 4 July, he said.
These implications have been seen in weekly room demand numbers, he said.
“For the week ending (27 June), the number of rooms sold was 16.14 million. For the week ending (4 July), it was 16.08 million,” he said. “The number of rooms sold declined by 75,000 rooms or so—the first time we registered a decline since the week of (11 April).”
Another telling story comes from Florida’s hotel occupancy. Freitag said 11 of Florida’s 13 markets, as defined by STR, recorded week-over-week decline in occupancy between 27 June and 4 July. Only two markets recorded increases, albeit very low levels, he said.
“The takeaway from this chart is clear. (A) larger number of cases with rollbacks of the restrictions, with beach closures, with hotel pool closures, had an immediate impact on the destination,” he said.
Conversely, July Fourth did have a positive impact on weekend occupancy in some submarkets. These include Duluth, Minnesota; Cape Cod, Massachusetts; Niagara Falls, New Yok; Branson, Missouri; and Sarasota/Beaches, Florida.
The increase in new COVID-19 cases also negatively affected hotel demand in three of the six chain scale segments for the week ending 4 July, which Freitag said is concerning.
“Looking at the July Fourth data … upper midscale, midscale and upscale class hotels all saw a decline in occupancy,” he said.
For more insights into U.S. hotel performance data, watch Freitag’s weekly video below:
Editor’s note: The video included in this article was filmed by Jan Freitag, SVP of lodging insights at STR, on 8 July and edited and produced by CoStar Group. HNN is a division of STR, a CoStar Group company.