Jan Freitag offered insights into STR's forecast downgrades and data for the week ending 16 May.
STR is the parent company of Hotel News Now.
Average daily rate is expected to decrease almost 22% this year and will not be reversed in 2021, he said.
“We’ve said it before and we’ll say it again, ADR recovery is never v-shaped,” he said. “We saw that post-9/11, and we also saw that in 2009. We’re expecting ADR will increase only 1.7%, which is a far cry from a V-shaped recovery.”
He added that STR doesn’t expect revenue per available room to meet 2019 levels until late 2024.
Occupancy is expected to be 35.8% for the year and will achieve 52.1% in 2021, Freitag said. Pricing power will likely be hard to come by in 2021 because U.S. hotel rooms are expected to be empty, he said.
“You see that the ADR increase between 2021 and 2020 is only $2,” he added.
STR is also comparing 2021 not to this year, but to 2019, he said.
“The data shows that the RevPAR decline is so steep that (next year, we’re still) 37% below the 2019 results, and for comparison, the last time we saw RevPAR of around $55 was in 2010,” he said.
Last week’s results
For the week ending 16 May, “weekend occupancy for the United States stood at just under 35%, and it is good to see that the upward momentum and trajectory in weekend occupancy continues,” Freitag said.
“Specifically, when we look at some of the smaller submarket areas that showed the sharpest point difference between weekend and weekday occupancy, we continue to see good results in the areas with beach access but also around Gatlinburg, Tennessee, with access to Dollywood,” he said.
The number of rooms sold last week stood at 11 million rooms, he added.
“It is also good to see that the TSA reports continued increases in the number of people going through their checkpoints, which last week stood at 1.4 million,” he said, adding it is important to realize that in 2019, TSA screened 2.2 million people a day.
Watch the video below for more data insights.
Editor’s note: The video included in this article was filmed by Jan Freitag, SVP of lodging insights at STR, on 20 May and edited and produced by CoStar Group. HNN is a division of STR, a CoStar Group company.