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AS A RESULT of a larger impact from the Omicron variant, U.S. hotel occupancy worsened in the second week of January in comparison with pre-pandemic levels, according to STR. However, occupancy was higher than the previous week on an absolute basis. Occupancy was 48.8 percent for the week ending Jan. 15, up from 45.4 percent the week before and down 16.3 percent from the comparable week in 2019. ADR was $122.12 for the week, up from $119.92 the week before, but down 1.6 percent from two years ago. RevPAR reached $59.57, up from $54.47 the prior week and down 17.6 percent from the same period two years ago. According to STR, ADR and RevPAR were up week over week and when indexed to 2019.

A STRONGER THAN expected performance by U.S. hotels in the fourth quarter of 2021 led CBRE Hotels Research to upgrade its forecast for the rest of 2022. CBRE now forecasts RevPAR will reach 2019 nominal levels by the third quarter of this year, one year earlier than the previous forecast. Occupancy is expected to rise 6.7 percent to 61.3 percent this year, then rise 5.2 percent to 64.4 percent in 2023. ADR is forecast to rise 10.1 percent to $133.94 in 2022 and go up 6 percent more to $141.99 in 2023. CBRE expects RevPAR to rise 17.5 percent in 2022 overall to $82.04 and then rise 11.5 percent to $91.46 in 2023. Positive trends, such as high employment and the return to the office for many workers who had been working from home contributed to the revised forecast, CBRE said. Other factors contributing to the improvement include below-average supply growth, strong domestic leisure trends, the resumption of inbound international travel and a predicted return to office later this year. However, ongoing inflation and geopolitical tensions connected to the war in Ukraine still threaten progress.

U.S. HOTEL PERFORMANCE saw a decline in the last week of September compared to the previous week, as expected, according to CoStar. However, there was an improvement in year-over-year comparisons, particularly in occupancy due to a favorable Rosh Hashanah calendar shift. Occupancy stood at 66.7 percent for the week ending Sept.30, marking a slight decrease from the preceding week's 68.5 percent, and a 0.8 percent year-over-year rise. ADR was $157.89, down from the prior week's $164.97, but showed a 4.6 percent increase compared to the previous year. RevPAR also experienced a drop to $105.31, compared to the previous week's $112.96, yet still represented a 5.4 percent rise from 2022.

U.S. WEEKLY HOTEL performance posted mixed year-over-year comparisons, while occupancy, ADR, and RevPAR declined in the second week of May over the previous week, according to STR. Meanwhile, "worsened comparisons than the week prior were expected due to normal given seasonal slowing and the negative side of the Mother's Day calendar shift," STR said. Occupancy was 65.1 percent for the week ending May 13, declined from 65.2 percent the week before and down 2 percent over the comparable week in 2022. ADR stood at $154.90, down from $157.62, and increased 3.4 percent from 2022. RevPAR came in at $100.81 in the last week, declined from $102.74 the week before and increased 1.3 percent against the same period in 2022. Among the top 25 markets, Philadelphia registered the only double-digit increase in occupancy in the second week of the month, up 13.3 percent to 73.2 percent. ADR jumped 14.5 to $189.50, while RevPAR was up 29.7 percent to $138.80. Of note, New York City, 83.7 percent, was the only major market to report occupancy above 80 percent. That level was up 3.9 percent year-over-year.

OCCUPANCY PROJECTIONS ARE dropping while ADR projections are rising in a new forecast for U.S. hotels by STR and Tourism Economics. RevPAR is still expected to recover fully on a nominal basis this year, according to the forecast released Thursday at STR's 14th Annual Hotel Data Conference in Nashville. However, RevPAR is still expected to take until 2025 to recover when adjusted for inflation, according to the forecast. For 2022, RevPAR is now expected to average $93 compared to the projection of $92 released in June, when projected nominal RevPAR recovery was set in 2023. The occupancy projection for the year was lowered to 64.6 percent for the year and the ADR projection rose to $148. The updated forecast adds a little more than $2 to the ADR projection for both 2022 and 2023, and occupancy was lowered by less than a percentage point for each year.

ALL PERFORMANCE METRICS of U.S. hotels improved in the fourth week of July and RevPAR reached an all-time high on a nominal basis during the week, according to STR. Occupancy was the highest since early August 2019 in the week. Occupancy was 72.8 percent for the week ending July 23, up from 72 percent the week before and dropped 6 percent from 2019. ADR was $158.79 for the week, up from $157.23 the week before and increased 16.4 percent from three years ago. RevPAR reached $115.59 during the week, up from $113.28 the week before and increased 9.3 percent from 2019. Among STR's top 25 markets, Orlando reported the only occupancy increase, up 2.2 percent to 81.8 percent, over 2019. San Diego (87.1 percent) led the markets in absolute occupancy during the week, followed by Oahu Island (86.2 percent) and Seattle (85.7 percent). San Diego also posted the largest ADR gain, increased 40.5 percent to $286.50, over 2019.

HOTELS IN THE Americas performed above 2019 levels, although RevPAR is stabilizing amidst decreasing consumer travel spending, according to real estate firm JLL. This has affected resort markets heavily dependent on leisure travel. In contrast, urban travel demand is on the rise, driven by group, corporate, and inbound international travel. According to JLL's Global Real Estate Perspective for February 2024, global hotel RevPAR surpassed 2019 levels by 11.7 percent in the first 11 months of 2023. The global urban market strengthened with increased international travel and the return of business and group demand. London, New York, and Tokyo are expected to lead global RevPAR performance in 2024 as urban travel rebounds. Stabilization has weighed heaviest in resort markets, particularly in the Americas and EMEA, while Asia-Pacific continues to accelerate as intraregional travel grows following border reopenings, the report added. Foreign capital, absent since the onset of COVID, is expected to become more active over the next 12 months. Middle Eastern and Asian investors are likely to lead, with urban markets in Europe and select U.S. cities as primary recipients of capital.

U.S. HOTEL OCCUPANCY increased in the first week of December, according to STR. But, all performance metrics were lower during the week when compared to same period in 2019. Occupancy was 54.8 percent for the week ending Dec. 4, up from 53 percent the week before and down from 8.8 percent for the same period in 2019. ADR for the week was $127.92, down from $128.41 the week before and decreased 0.5 percent when compared to two years ago. RevPAR increased to $70.08during the week from $68 for the week before but dropped 9.2 percent for the same period in 2019. According to the report, none of STR's top 25 markets recorded an occupancy increase over 2019, Only Los Angeles matched its 2019 comparable at 70 percent. Miami, lifted by Art Basel, reported the largest ADR increase when compared with 2019, up 32.9 percent to $373.71.

STR AND TOURISM ECONOMICS have increased year-over-year growth projections for ADR and RevPAR in the final revision of the U.S. hotel forecast for 2023. While some factors, such as higher interest rates and more restrictive lending, may impact the economy, their effect on the travel industry is not expected to be strong. In 2023, RevPAR saw a 0.3 percentage point increase, propelled by a 0.6ppt rise in ADR growth, according to STR and TE. Meanwhile, recent RevPAR trends affirm rate as the predominant performance driver. Occupancy was downgraded by 0.2ppts, STR and TE said in a statement. Growth projections for key performance metrics in 2024 remained flat from the previous forecast, reflecting the stabilization of long-term average trends.

THE U.S. DEPARTMENT of Justice will appeal the recent court ruling that overturned a federal mask mandate on public transportation. In response, the U.S. Travel Association said that the mandate is simply out of step with the current public health landscape. Last week, U.S. District Judge Kathryn Kimball Mizelle in Tampa ruled that the CDC had overstepped its authority in issuing the mask mandate. The Centers for Disease Control and Prevention asked the DOJ to appeal the ruling. In a statement on April 20, the CDC said that an order requiring masking in the indoor transportation corridor remains necessary for the public health. CDC will continue to monitor public health conditions to determine whether such an order remains necessary, it added.

U.S. HOTEL PERFORMANCE increased in the second week of December, according to STR. ADR was up during the week when compared to same period in 2019. Occupancy was 57.4 percent for the week ending Dec. 11, up from 54.8 percent the week before and down by 4.8 percent for the same period in 2019. ADR for the week was $128.35, up from $127.92 the week before and increased 2.3 percent when compared to two years ago. RevPAR increased to $73.73 during the week from $70.08 for the week before but dropped 2.7 percent for the same period in 2019. Among the Top 25 Markets, Norfolk/Virginia Beach saw the only occupancy increase among STR's top 25 markets during the week, up 4.2 percent to 55.2 percent over 2019. New York City reported the highest weekly occupancy level of any STR-defined U.S. market at 81.5 percent. However, its occupancy level was 13 percent lower than two years ago. Miami registered the largest ADR increase during the period, up 30.1 percent to $229.34, when compared to 2019.

U.S. HOTEL PERFORMANCE declined in the third week of December as anticipated ahead of the holidays, according to CoStar. Three key metrics-occupancy, ADR, and RevPAR-all dipped compared to the previous week. Occupancy fell to 43.9 percent for the week ending Dec. 23, down from the previous week's 54.7 percent, but demonstrated a year-over-year increase of 0.5 percent. ADR decreased to $131.97, compared to the prior week's $142.62, marking a 0.9 percent decline from the previous year. RevPAR also declined to $57.9, compared to the prior week's $77.99, indicating a 0.4 percent decrease from the corresponding period in 2022. Among the top 25 markets, Boston experienced the most significant year-over-year increases, with occupancy rising by 21.5 percent to 46.2 percent and RevPAR up by 23.1 percent to $65.68. Anaheim recorded the highest ADR increase, rising by 14.7 percent to $190.86.

A STRONG PERFORMANCE by U.S. hotels during the first quarter of 2022, along with other factors, are leading CBRE Hotels Research to raise its forecast for the rest of the year. The research firm now expects a full recovery in ADR in 2022 and in demand and RevPAR in 2023. First quarter RevPAR reached $72.20, up 61 percent from year earlier, despite a surge from the COVID-19 omicron variant, according to CBRE. RevPAR growth was driven by a 39 percent increase in ADR and a 16 percent increase in occupancy. ADR was 5 percent ahead of 2019's levels, marking the third consecutive quarter in which levels exceed the same period in 2019. These rising rates demonstrate that travelers aren't price-sensitive in many peak-demand markets.

GOPPAR FOR U.S. hotels improved in September compared to the month before and it exceeded the pre-pandemic levels, according to STR. Meanwhile, the cost of labor per available room came in higher than the pre-pandemic comparable for the first time. GOPPAR was $84.03 for the month, up from $64.26 reported in August. It was $78.30 for July and $91.23 in June. The performance index was $88.63 in May and stood at $90.96 in April. EBITDA PAR was $60.71 for September, TRevPAR was $222.97 and labor costs per room were $71.52. "Labor costs moved ahead the 2019 comparable due to continued high levels of hospitality unemployment and more spending on contract labor," said Raquel Ortiz, STR's director of financial performance. "Total labor costs were up 5 percent year to date, with all departments reporting higher expenses, except F&B, due to less group demand earlier this year. GOPPAR was the strongest since June 2022, and profit margins came in higher than September 2019. Profit margins have been strong for some time caused by lower employment levels and reduced services."

INTERNATIONAL INBOUND TRAVEL is expected to slow down in the fall after surging over the summer, according to the latest U.S. Travel Association forecast. USTA also expects it may take until 2025 for the travel segment to recover to pre-pandemic levels. Inbound travel recovery picked up in summer and reached a pre-pandemic high of 35 percent below 2019 levels in July 2022, said U.S. Travel Association. It improved from a 41 percent decrease in May and declines of more than 50 percent earlier in 2022. The latest report by Aaron Szyf, economist, USTA, said that inbound travel recovery continued from Europe and Latin America in the past few months, which was 22 percent below 2019 levels in July. Meanwhile, Asian markets declined 66 percent in July, largely due to stagnation from China and a very slow return from Japan.

PROFITS FOR U.S. hotels reached a 28-month high in March, according to STR. Spring break travel and higher rates are pushing performance up on all levels. GOPPAR was $83.81 for the month, the highest level for the metric since November 2019. It was less than $10 shy of reaching the pre-pandemic comparable from March 2019. In February GOPPAR stood at $58.88. EBITDA PAR was $62.68, TRevPAR was $204.84 and labor costs per room were $61.45. For the latter two it was their highest mark since March 2020.

THE MAJOR CHALLENGES faced by U.S. hotels are labor, the return of corporate, group and conference travel, the impact of inflation on cost lines and the energy crisis, said Michael Grove, COO of HotStats, in a recent presentation. In the same session at the International Hospitality Investment Forum, panelists debated the best metric by which to measure industry performance. While speaking during a panel session at IHIF titled "Decoding the Data", Grove said that the most pressing issue is fixed costs are being replaced by oncoming growth in the variable areas which changes the dynamic of the cost base. "One of the key items around the average rate growth is what's going to happen when the full business mix returns," Grove said. "We still have a lot more of the lower-rated business to come back-the tours and groups and the other segments. We need to look at the impact on the cost lines themselves, the expense items around the P&L and what impact inflation is having on those, what impact the labor challenge is having.

CBRE HOTELS RESEARCH has once again revised its forecast for the second half of 2022. The revision is mainly due to strong gains in the second quarter and expectations of positive growth next year. RevPAR for the second half of the year will rise to 14.7 percent year-over-year, up from the previous projection of 13.1 percent in May, according to CBRE. The reasons for the spike are a 3.5 percentage point increase in ADR and a 2.2 percentage point reduction in CBRE's demand forecast. Second quarter RevPAR reached $98.84, up 38 percent year over-year, and an all-time quarterly high at 106 percent of 2019's level. RevPAR growth was driven mainly by ADR, up 25.5 percent, followed by occupancy, up 9.9 percent.

THE U.S. HOUSE of Representatives recently passed a Congressional Review Act resolution to overturn the National Labor Relations Board's October ruling on its definition of joint-employer status. The American Hotel & Lodging Association welcomed the resolution, but President Biden has promised to veto it. The NLRB ruling, issued Oct. 26 and due to take effect Feb. 26, defines a joint employer to be any company that shares or codetermines one or more essential terms and conditions of employment. Those include ages, benefits, and other compensation; hours of work and scheduling; the assignment and supervision of duties to be performed; work rules and tenure of employment. The final rule rescinds the 2020 rule that was promulgated by the prior board and applies the new definition of joint employer to any entity that can control the essential terms of employment whether or not such control is exercised and without regard to whether any such exercise of control is direct or indirect. House Joint Resolution 98 would nullify the NLRB's rule.