Sizzling Summer Led by Leisure Travel Bookings

NEW YORK—Hotels in major North American markets are continuing to experience strong growth driven by increases in average daily rate (ADR), according to data from the July 2015 TravelClick North American Hospitality Review (NAHR). Strong rates and steady bookings are leading to a significant uptick in revenue per available room (RevPAR).

“Hoteliers have good reason to celebrate this summer given the encouraging trends in leisure booking pace and ADR,” said John Hach, senior industry analyst at TravelClick. “While our overall forecast is positive, it’s very important that hoteliers focus on creating experiences throughout the entire guest stay that provide value in order to continue on the momentum through the end of summer.”

For the next 12 months (July 2015 – June 2016), overall committed occupancy is up 2.4 percent when compared to the same time last year. ADR is up 4.3 percent based on reservations currently on the books. Transient bookings (individual reservations made by business and leisure travelers) are up 3.1 percent year-over-year and ADR for this segment is up 4.7 percent. When broken down further, the transient leisure (discount, qualified, and wholesale) segment is showing occupancy gains of 5.1 percent and ADR gains of 3.5 percent. Transient business (negotiated and retail) segment occupancy is down 0.2 percent but ADR is up 6.4 percent. Group segment occupancy is up 2 percent and ADR has increased to 3.4 percent, compared to the same time last year.

“There is growing evidence indicating that hoteliers who are doing well this summer are rewarding guests with value added inclusions,” Hach added. “This contributes to strong ADR growth coupled with positive guest reviews that drive repeat business. It is clear that savvy hoteliers have caught on to this successful correlation.”