Hotel Construction Declines Worldwide
Skift Take
- According to the latest STR U.S. bubble chart update, for the four weeks ending April 15, recovery growth across a range of industry indicators took a small backstep, with occupancy falling from the prior month.
- Each of the four world regions showed a year-over-year decline in hotel construction activity, with Asia Pacific coming closest to its 2022 comparable, according to March 2023 pipeline data from STR.
- The Hospitality Asset Manager Association released the results of its Spring 2023 Industry Outlook Survey.
The DJIA rose 66 points while Nasdaq was down 35, the S&P 500 rose 4 points and the 10-year treasury yield was down .06 to 3.52%. Lodging stocks were mixed to modestly higher. The lack of volatility in the overall market the past week, even as we get into earnings season, is a bit disturbing.
According to the latest STR U.S. bubble chart update, for the four weeks ending April 15, 2023, recovery growth across a range of industry indicators took a small backstep, with occupancy (64.1%) falling 0.7 percentage points from the prior month. Recent occupancy indicators were also down year over year (-0.2ppts) as well as from 2019 (-5.1ppts). The Top 25 Markets were led in occupancy by Tampa (80.4%) which had a 5.5 percentage point decline from the prior four weeks. Next was New York City (80.3%, +4.2ppts YoY), Las Vegas (79.4%, -2.6 ppts), Orlando (78.2%, -0.9% ppts) and Oahu (77.5%, +2.1 ppts). None of the Top 25 Markets matched their 2019 occupancy levels for the recent four weeks. However, many large markets have narrowed their occupancy margins above this time last year. Oahu ran the narrowest occupancy deficit from 2019 (-1.8%) while six of the Top 25 Markets showed four-week/2019 occupancy shortfalls of 10 ppts or greater, including Chicago, Philadelphia and Minneapolis. Gains in ADR among Top 25 Markets present a more favorable pattern with all but two large markets seeing YoY increases. Four of the better-performing markets (Oahu, Tampa, New York City and Orlando) saw 8% or higher increases in ADR. A handful of lower-performing occupancy markets saw hyperactive YoY ADR gains, including St. Louis (+10.5%) and Chicago (+9.4%). Over
