Phoenix Hotels Recorded a Jump in RevPAR in September

Key Performance Indicators

September 2018 vs. September 2017

RevPAR: +15.6 percent to $116.82
TrevPAR: +9.8 percent to $232.14
Payroll: -2.6 points to 38.7 percent
GOPPAR: +32.6 percent to $67.22

Phoenix hotels recorded a 32.6 percent year-on-year increase in GOPPAR on the back of a 15.6-percent uplift in RevPAR, according to the latest HotStats report. An increase in both volume and price drove top-line growth, the report found.

September marked a return to stronger levels of performance for Phoenix hotels after the single-figure GOPPAR recorded in July ($5.96) and August ($4.38), as demand from the business segment returned and sparked an increase in profit per room, which hit $67.22.

Increases in both room occupancy (up 5.2 percentage points to 66.1 percent) and achieved average room rate (a 6.5 percent increase to $176.72) contributed to the growth in profit per room in September. While an increase across all segments drove the growth in the achieved average room rate, it was primarily focused in the corporate (up 5.6 percent) and association/convention corporate group (up 8.5 percent) sectors.

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“Hotels in Phoenix will be glad to see the end of the summer period as the desert city is not as much a popular leisure destination due to the stifling heat. This was reflected in the profit margin of hotels in the city,” said David Eisen, director of Hotel Intelligence & Customer Solutions at HotStats. “September has marked a return to business as usual, and despite the challenges during the summer, year-to-date profit per room at hotels in Phoenix remains ahead of the same period in 2017.”

In addition to the 15.6 percent increase in rooms revenue, all non-rooms departments recorded growth, contributing to the 9.8 percent increase in TRevPAR, which grew to $232.14.

The growth in topline performance was further bolstered by a drop in costs, which included a 2.6 percentage point saving in labor. This is still comparatively high at 38.7 percent of total revenue—well above the year-to-date average of 34.7 percent.

Despite the return to a more robust period of operations, profit conversion at hotels in Phoenix remained relatively low at 29 percent of total revenue.

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