US hotel rates hit record high
Travelers continue to return to hotels and pay record rates for their rooms.
The national average daily rate for a room in March was $146.61, the highest for any month on record, according to hotel data provider STR. However, STR noted that when adjusted for inflation, the ADR for March was around 2% lower than the same measure for March 2019.
For example, the average rate in Miami last month was $329.50, up from the average rate of $252.80 in March 2019, according to The Points Guy, citing STR data.
Revenue per available room increased by 4% compared to March 2019, but this was mainly due to the higher average daily rate, which was 10% higher than 2019 figures at the same time.
“Easter and Spring Break are just the two obvious indicators of continued pricing power for the U.S. hospitality industry, driven, as we’ve said many times before, by very healthy leisure demand,” he said. CoStar national hospitality manager Jan Freitag told The Points Guy.
Occupancy still remained slightly below 2019 figures of around 4%, CoStar, STR’s parent company, reported, but March figures hint at the start of the long-awaited return of business travelers.
STR data shows U.S. hotels sold a total of 6.6 million group room nights in March. Although this is far from the 7.8 million group nights of March 2019, it indicates a further improvement in hotel demand.
City and airport-adjacent hotels, which rely on non-vacation travelers as guests, saw strong month-over-month increases in room rates, CoStar reported. City hotels increased their average daily room rates by 56% month over month, while airports increased by 42%. Freitag said he hoped the data signaled the start of a recovery for these business-dependent hotel properties.
“I’m very, very interested to see what the summer has in store for us in terms of pricing power,” Freitag said.