ADR Growth to Bring Strong, Profitable Start to 2015

NEW YORK—Hotels in major North American markets experienced positive growth in both rate and occupancy across most travel segments according to data from the December 2014 TravelClick North American Hospitality Review (NAHR). With average daily rate (ADR) growth of 4.6 percent for the next 12 months, hoteliers will be ringing in 2015 with a strong and profitable start.

“The upward pricing momentum that began in 2014 is continuing into the New Year,” said John Hach, senior vice president, global product management at TravelClick. “While there is cause for celebration, hoteliers still need to be watchful that the pace at which transient rooms are being booked may slow. The bottom line is that hoteliers had a lot to be thankful for in 2014 as group rebounded and ADR and occupancy continued to increase; and there is a lot to look forward to in 2015, particularly the fact that we expect hotels will continue to see sustained ADR growth throughout most North American markets.”

For the next 12 months (December 2014–November 2015), overall committed occupancy is up 2.4 percent when compared to the same time last year. ADR is up 4.6 percent based on reservations currently on the books.

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Transient bookings (individual reservations made by business and leisure travelers) are up 2.3 percent year-over-year and ADR for this segment is up 4.9 percent. When broken down further, the transient leisure (discount, qualified, and wholesale) segment is showing occupancy gains of 1.3 percent and ADR gains of 4.8 percent. Transient business (negotiated and retail) segment occupancy is up 3.9 percent and ADR is up 4.7 percent. Group segment occupancy is ahead by 2.4 percent and ADR is up 3.7 percent, compared to the same time last year.

“Strong ADR and occupancy gains in 2014 led to increases in revenue per available room (RevPAR) in Q4, up 8 percent for October and November and 6.6 percent for the month of December,” Hach continued. “We’re very optimistic that RevPAR performance will be robust in the upcoming year as savvy hoteliers increase their reliance on advanced business intelligence solutions to ensure they maximize revenue.”