According to PricewaterhouseCoopers latest U.S. lodging forecast, RevPAR (revenue per available room, which is the best indicator of the lodging industry’s long-term financial health) will decline by 15.0 percent in the fourth quarter of 2001. The study also predicts a total 7.1 percent decline in 2001, the lowest since this type of data was first collected 34 years ago.
Another hotel consulting firm, LodgingForecast in Durham, N.H., predicts a slow rise in RevPAR beginning in April of 2002. "The lodging recession will have the usual V-shape and its low point will be reached in January of 2002," says Raymond Goodman, chief market strategist. He expects lodging activity to remain relatively soft over the next 11 months, and rebound significantly in early 2003. PricewaterhouseCoopers sees a slightly different scenario, with a return to positive growth in the third quarter of 2002.
Not all hotels segments are suffering equally. According to PricewaterhouseCoopers, the priciest large urban hotels are being hit the hardest, followed by large urban convention hotels; destination resorts that require air travel; less established, expensive boutique properties; and brand new hotels.
