The Hospitality Services Group of Ernst & Young has revised its growth and profitability forecasts for the U.S lodging industry in 2001 because of repercussions from September 11.

The firm's original forecast (released in January) included a projected growth in the national revenue per available room of 3.7 percent, to $56.33. Because of continuing reductions in business and leisure travel, the firm now projects a revPAR decline of 5.2 percent, for an overall 2001 revPAR of $51.

The projected 2001 occupancy rate of 63.7 percent was already lower than 2000 as a result of reductions in business travel. Ernst & Young forecasts that the national average occupancy will fall an additional 3.2 percent, to 60.5 percent for the year. This occupancy figure is the lowest in a decade, since occupancy dropped to 61.8 percent during the Gulf War.

“The combination of the economic slowdown and tragic events of September 11 have led to the worst occupancy rates we've seen in 10 years,” says Chase Burritt, national director of Ernst & Young's Hospitality Services Group. Burritt expects business travel to be the first area to recover.