Despite an overall decline in weekly U.S. hotel occupancy, largely due to people staying home for Mother’s Day, several key markets reported their highest occupancy levels of the pandemic era.
The latest weekly performance data from STR, CoStar’s hospitality analytics firm, shows occupancy for the week ending May 7 was 63.9%, down 2.7% from the previous week. The largest decrease came on the weekend when occupancy fell 5.6 percentage points, accounting for 65% of the weekly demand loss.
Comparing past Mother’s Day weeks, it is normal for occupancy to fall from the preceding week. This year’s decrease, however, was the largest since 2004. The largest share of the demand decline came from the group segment, which accounted for 74% of the room demand lost in the week. The largest loss of groups was on the weekend, when demand dropped by more than 300,000 room nights.
Weekday occupancy from Monday to Wednesday was down only 1.5 percentage points, and weekly average daily rate was basically flat, up 0.3%. As a result, weekly revenue per available room decreased 3.7%.
While weekend performance was down, several markets did well.
Louisville, Kentucky, reported 93% occupancy as the Kentucky Derby led to a 348% week-over-week increase in weekend ADR to $578 — the highest weekend ADR of any market. Strong weekend occupancy — 80% or higher — was also recorded in Austin, Nashville, Raleigh/Durham, Salt Lake City, San Diego and 13 other markets. Overall U.S. weekend occupancy was 70.8%.
Weekday occupancy dropped to 63.3% nationwide. In the top 25 markets, weekday occupancy was 68.5%, which was the fourth-highest level of the pandemic era.
Even though weekday occupancy was down across the nation, Boston (72.8%), Minneapolis (63.9%), and Washington, D.C., (72.5%) reported their highest levels since the start of the pandemic.
Overall, top 25 market weekday occupancy ranged from 78.5% in New York to 58.7% in Chicago. NYC’s weekday occupancy was its third highest since the start of the pandemic, and the market has recorded five of its six highest occupancies of the pandemic era over the past five weeks.
Hotel occupancy also declined in central business districts, with the weekly level dropping to 69.2% from 72.2% in the previous week. A week prior, central business district occupancy was at its highest value since the start of the pandemic. In this most recent week, occupancy was the third best of the pandemic-era.
Room demand for central business districts has been above 90% of the comparable 2019 level for the past three weeks. Weekday occupancy also fell from its pandemic high to 70.5%, still the second-best since March 2020. ADR in central business districts was $229 on the weekend, the highest level of the pandemic era, and $162 for the weekdays, second-best.
Among specific central business district submarkets, Boston (81.8%), Denver (83.5%), Minneapolis (82.5%), and Washington, D.C. (75.1%) were all at their highest weekday occupancies since the start of the pandemic. Eleven of the 20 central business district submarkets reported weekday occupancy above 70%, which is the same number as in the previous week. Weekday occupancy reached 80% or higher in six central business district submarkets. the largest number since March 2020. Weekday ADR also increased in central business districts for the third week in a row, this time by 1.7%.
Like the past 12 weeks, ADR remained above the 2019 comparable and was 12% higher than in the comparable week of 2019.
Weekday ADR declined for a fourth consecutive week but was up 1.4% in the top 25 markets, led by growth in Boston (+11%), Denver (+10%), Houston (+11%), Minneapolis (+20%) and New York (+9%).
Total U.S. weekend ADR was up 1.3%, led again by Louisville and 25 other markets, where weekend ADR increased by more than 10% week over week. In the top 25 markets, weekend ADR was up 0.7%, driven by Miami, which recorded a 53.9% ADR gain to $479 as a result of hosting the Miami Grand Prix.
Even though weekly RevPAR declined, it remained ahead of 2019 by 5%. Adjusting for inflation, real RevPAR was 7% lower than in 2019.
On a market level, 115 of the 166 STR-defined markets reported “peak” RevPAR — higher than what it was in the comparable week of 2019 — with another 41 in “recovery,” between 80% and 100% of 2019. Sixty-one markets were at “peak” real RevPAR with 79 in “recovery.” Over the past 28 days, 128 markets reported “peak” RevPAR — 66 adjusted for inflation — as 36 were in “recovery” — 82 adjusted for inflation.
Isaac Collazo is VP Analytics at STR.
This article represents an interpretation of data collected by CoStar's hospitality analytics firm, STR. Please feel free to contact an editor with any questions or concerns. For more analysis of STR data, visit the data insights blog on STR.com.