Group Bookings Brighten Hotel Outlook

NEW YORK—Committed occupancy and average daily rates (ADR) for the first quarter of 2017 are showing major signs of growth with group travel leading the way despite the continuing lag in transient booking pace in the fourth quarter of 2016, according to new data from TravelClick’s November 2016 North American Hospitality Review (NAHR).

Across all travel segments in the first quarter of 2017, occupancy and ADR are up 6.7 percent and 2.7 percent, respectively, and occupancy for the group segment is up 6.8 percent.

“Even with the slowing transient reservation pace this month, especially within the business segment, hoteliers should look to the New Year for a promising outlook,” said John Hach, TravelClick’s senior industry analyst. “Group occupancy and booking pace in particular are showing notable signs of improvement in 2017, especially within the first quarter.”

For the next 12 months, transient bookings are up 2.7 percent year-over-year, and ADR for this segment is up 2.0 percent. When broken down further, the transient leisure (discount, qualified and wholesale) segment is showing occupancy gains of 3.9 percent with ADR gains of 2.8 percent. The transient business (negotiated and retail) segment is down -0.8 percent, but ADR is slightly up 1.7 percent. Lastly, group bookings are up 3.8 percent in committed room nights over the same time last year, and ADR is up 2.6 percent.

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“While committed occupancy growth continues within the majority of North American markets, the decline in the pace of new reservations throughout the past two quarters is beginning to flatten,” added Hach. “This environment amplifies the need for hoteliers to compete for bookings well into the upcoming New Year, and it’s especially important for hoteliers to invest and leverage advanced pacing business intelligence solutions to maximize revenue per available room (RevPAR) within their local markets.”

The November NAHR looks at group sales commitments and individual reservations in the 25 major North American markets for hotel stays that are booked by November 1, 2016, from the period of November 2016 to October 2017.

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