Benchmarking and analytics agency STR’s upgraded final 2020 US hotel forecast was released during the recent online NYU Hospitality Conference and found leisure demand stronger than anticipated. Despite the slight upgrade, the forecast for 2021 remains functionally unchanged and full recovery in revenue per available room (RevPAR) has been deemed ‘unlikely’ until 2024.
Amanda Hite, president of STR, said: “Even with the encouraging vaccine news of this week, this pandemic and the subsequent economic impact will continue to limit hotel demand generators into the second half of next year.
“Business demand won’t return at a substantial level until caseloads are better contained and, in the meantime, recovery is going to be primarily driven by lower-tier hotels in the leisure-driven markets with outdoor offerings.”
Adam Sacks, president of Tourism Economics, said: “The economy has entered a slower stage of recovery, and Covid-19 will continue to shape travel conditions in coming quarters. Assuming substantial progress is made against the virus in the first half of 2021, we anticipate travel demand will rebound strongly in the second half.”
STR and Tourism Economics have predicted the hospitality industry will recapture 80% of demand by the end of 2021, although RevPAR will be 34.2% lower than in 2019. They project that average daily rate (ADR) and revenue will follow a slower recovery timeline, with full demand recovery coming at the end of 2023 and a return to pre-pandemic RevPAR levels by the close of 2024.