WASHINGTON, DC — The outlook for the U.S. lodging industry, particularly historic hotels, continues to be extremely strong, according to CBRE Hotels’ Americas Research (CBRE), it was announced Jan. 4.
For the third consecutive year, CBRE Hotels’ Americas Research presented a Historic Hotels of America — CBRE five-year forecast at the Historic Hotels of America annual conference held at The Royal Hawaiian, A Luxury Collection Resort, in November 2016.
CBRE relies on historical hotel performance data from STR, and economic forecasts from CBRE Econometric Advisors, to prepare its lodging forecasts.
Key points presented by Mark Woodworth, senior managing director at CBRE, to more than 200 owners, asset managers, general managers, and sales and marketing leaders at the conference include:
Per STR, through the first three quarters of 2016, the aggregate RevPAR for historic hotels that are members of Historic Hotels of America placed between the national averages for all upper-upscale and all luxury hotels in the U.S.
Over the next five years, RevPAR for historic hotels is expected to grow at a compound average annual rate of 2.7 per cent, which is greater than the RevPAR forecasts for the nation’s upper upscale hotels at 2 per cent and 1.7 per cent for luxury hotels. Most of the RevPAR growth is expected to stem from increases in ADR.
Annual occupancy levels for hotels that are members of Historic Hotels of America remains 8 to 10 percentage points above the national average occupancy level through 2020.
Based on a set of information pulled from CBRE’s database of hotel operating statements, historic hotels (including those that are not members of Historic Hotels of America) had an average ADR of $256.11, higher by more than 11.6 per cent than the $229.59 ADR for contemporary hotels.
Historic hotel revenue has recovered fully from the 2007 down-turn, while comparable contemporary hotels are still lagging in revenue recovery.
“The data strongly supports the idea that many consumers favor and will pay more for the unique hotel experience historic properties can offer,” said Woodworth.