This week, CBRE released an updated 2020 outlook that analyzes the impact of the COVID-19 pandemic on hotel performance and provides insights into recovery later this year. While RevPAR will likely contract significantly in Q2 2020, CBRE expects that as early as Q3 2020, hotel activity will begin to stabilize, with recovery picking up in Q4 2020.
Among the report’s key findings is that GDP growth is expected to slow to 0.4 percent in 2020. U.S. RevPAR will decline by 37 percent this year, with a contraction of more than 60 percent in Q2. Demand will decline by 28 percent in 2020, and average daily rates (ADRs) are expected to decline 11 percent.
Social distancing efforts, which have led to travel restrictions and limits on group gatherings, present the most complex constraint to travel, CBRE noted in the report. CBRE predicts that hotels that primarily cater to discretionary travel will feel the biggest impact: luxury, upper-upscale, urban, airport, and resort properties.
