Moody’s reports on the recently released June U.S. lodging data.
June U.S. lodging data shows occupancy growth tracking at the bottom end of our forecast range: occupancy growth was essentially flat at 0.1 percent for the first six months of the year, and came in at the bottom end of our forecast range of 0 percent—1 percent occupancy growth for 2016.
Average Daily Room Rate (“ADR”) year-to-date growth of 3.1 percent lags our forecast range of 3.5 percent to 4.5 percent; hotel operators were not able to increase pricing as much as we had originally forecasted.
Slow RevPAR growth signals moderate second quarter earnings growth; We anticipate that Marriott International and Hyatt Hotels’ EBITDA will grow in line with our industry forecast while Hilton Worldwide Holdings’ EBITDA will likely top our industry forecast.
Although overall occupancy growth was flat for the first six months of 2016, 12 of the top 25 markets in the U.S. are experiencing declining occupancy; Chicago, Houston, Miami, and New York are all experiencing declining ADR’s which has resulted in declining RevPAR.