5 things to know: 29 May 2020
5 things to know: 29 May 2020
29 MAY 2020 9:37 AM

From the desks of the Hotel News Now editorial staff:

  • April performance shows US hotels’ ‘worst month ever’
  • Locals worry as vacation spots reopen for summer
  • US hotel results for week ending 23 May
  • US consumer spending fell 13.6% in April
  • UK hospitality sector opposes visitor quarantine

April performance shows U.S. hotels’ ‘worst month ever’: Revenue per available room fell 51.9% in March, making it the steepest monthly decline recorded in STR’s history, writes STR SVP of Lodging Insights Jan Freitag in his monthly installment of Freitag’s 5. STR is the parent company of Hotel News Now.

“Then April came along and said, ‘Hold my beer,’” he writes. U.S. hotel RevPAR fell 79.9% in April, setting a new record.

The effect of the COVID-19 pandemic does not compare to 9/11 or the Great Financial Crisis, he writes. This is an economic crisis amid a global health emergency, and any economic metric “is unprecedented and therefore it is a bit unhelpful to study prior recoveries as a guide.”

Locals worry as vacation spots reopen for summer: Hotel rooms around Lake Havasu in Arizona started filling up by the end of April, a development that was both welcome by locals wanting the tourism dollars and unwelcome by those worried about the coronavirus pandemic spreading in Lake Havasu City and overwhelming its hospital, The Wall Street Journal reports. The area attracted travelers when the lake, a federal waterway, was still open.

Lake Havasu Mayor Cal Sheehy is asking visitors to maintain social distancing and understand that many of its shops and restaurants are still closed or operating at limited capacity, the newspaper reports.

Other locales in the U.S., such as North Carolina’s Outer Banks and parts of Florida, are experiencing similar conflicted feelings about their popularity among day trippers, the article states.

U.S. hotel results for week ending 23 May: Hotels in the U.S. reported year-over-year declines in the three key performance metrics for the week ending 23 May, according to data from STR. While still down, the results are a small rise compared to previous weeks and not as severe as the drops in April.

U.S. hotels reported a 50.2% drop in occupancy to 35.4%, which combined with a 39.7% decline in average daily rate to $80.92 resulted in revenue per available room falling 69.9% to $28.67.

Along with national occupancy levels rising thanks to popular leisure destinations over the Memorial Day weekend, STR SVP of Lodging Insights Jan Freitag said it was also noticeable that occupancy levels rose across all classes of hotels.

U.S. consumer spending fell 13.6% in April: U.S. consumer spending dropped by 13.6% in April, the steepest decline in records dating back to 1959, The Wall Street Journal reports. The COVID-19 pandemic and resulting shelter-in-place orders “wiped out a decade of job gains within a month.”

However, the numbers seem to be slowly turning around after their April low as states begin reopening and people are returning to work, the article states.

“Some of the data suggests a stabilization,” said Kathy Bostjancic, chief U.S. financial economist at Oxford Economics. “It’s still overall a very tentative, slow recovery.”

U.K. hospitality sector opposes visitor quarantine: Several U.K. holiday companies and hotel owners are asking for the United Kingdom government to get rid of its plan to quarantine all visitors who arrive in the country, MarketWatch reports. The plan calls for visitors to self-isolate for 14 days starting 8 June or face a £1,000 ($1,237.17) fine.

In a letter to the U.K. government, more than 70 industry members, including those from major luxury hotels, said the quarantine would deter visitors.

“The very last thing the travel industry needs is a mandatory quarantine imposed on all arriving passengers which will deter foreign visitors from coming here, deter U.K. visitors from traveling abroad, and most likely cause other countries to impose reciprocal quarantine requirements on British visitors,” the letter states.

Compiled by Bryan Wroten.

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