WASHINGTON, D.C.–The outlook for the U.S. lodging industry, particularly historic hotels, continues to be extremely strong, according to CBRE Hotels’ Americas Research (CBRE).
CBRE Hotels’ Americas Research presented its two-year forecast at the Historic Hotels of America annual conference. CBRE relies on historical hotel performance data from STR and economic forecasts from CBRE Economic Advisors to prepare its lodging forecasts.
Based on a set of information pulled from CBRE’s database of hotel operating statements, historic hotels had an average ADR of $259.39, higher by more than 12 percent than the $231.16 ADR for contemporary hotels. Over the next two years (2018 and 2019), RevPAR for historic hotels is expected to grow at an average annual rate of 1 percent, which is slightly less than the RevPAR forecasts for the nation’s upper upscale hotels at 1.2 percent. Most of the RevPAR growth is expected to stem from increases in ADR.
Since 2009, historic resort hotels have achieved greater revenue and profit growth compared to their contemporary counterparts. “The data strongly supports the idea that many consumers favor and will pay more for the unique hotel experience historic properties can offer,” notes Mark Woodworth, senior managing director at CBRE.
Per STR, through the first three quarters of 2017, the aggregate RevPAR for historic hotels that are members of Historic Hotels of America placed between the national averages for all upper-upscale and all luxury hotels in the United States. Annual occupancy levels for hotels that are members of Historic Hotels of America remains approximately 8 percentage points above the national average occupancy level through 2019.
“Historic Hotels of America helps the consumer differentiate the authentic historic hotel from other older hotels,” says Lawrence Horwitz, executive director of Historic Hotels of America and Historic Hotels Worldwide. “Historic hotels can achieve a significant advantage in ADR and RevPAR versus contemporary hotels, especially when recognized as part of Historic Hotels of America.”
Photo: Inn at Willow Grove in Orange, Va., a Historic Hotels of America member.