HOTEL Forecast Update
Update for 2012
and Chad Church / STR - ATTACHED
Sent from: Greg L. Goforth / Coldwell Banker Commercial, JBA - Hotel Division
Greg’s recap and cliff notes:
How do we rate or score next year’s Hotel forecast? Whose prediction do you trust the most? I like the attached report from HotelNewsNow.com and Chad Church, Smith Travel Research (STR) who are the industry leaders! For me, it looks like in this macro environment of hotel 2012 forecasting for occupancy and rates we are still moving in a positive direction just NOT to the level of what was forecasted earlier 2011.
In my experience over the past 23 years in the hospitality industry, as corporate earnings from corporate America report profits from stronger sales, overall capital spending will increase. As reported in Q3 2011 we finally returned to 2008 levels, wow! When we look at hotel revenues, we target two main segments; business and leisure travellers. With an improving GDP and corporate earnings, business travel should remain strong and the group and convention segments should benefit. If leisure travel and
consumer spending can become consistent and grow we are looking for even more solid numbers this next year.
By the way, airlines have been very slow to add any capacity so airline load factors are reaching record levels. In the near term you may see airlines in certain markets add flights which can only add more occupancy to hotels. So it looks like the attached report by Chad Church / STR, whom I met at last year’s OLRA convention in Bend, Oregon will be numbers we can all live with! Bottom line, revenue per available room, our best and most accurate measurement for hotels will increase + 3.9% in 2012. Score this prediction as conservative to solid!