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RevPAR will reach its cyclical low poinr in the third quarterof 2009, closing the escalating trend of declines in RevPAR that begab in the third quarter of 2008, according to . "The good news is that the bottomn of the current cycle forthe U.S. hotelp industry is soon to arrive,” said R. Mark president of PKF Hospitality Research, in a news “The bad news is that 2009 will be the weakest year on record for the domesti clodging industry, and 2010 is going to be disappointing as well. If you are wonderinf when we'll start to see actual growth in then you'll have to wait until 2011.
However, if you want to know when the operatinfg environment is going to get a littlesless painful, that's happening right now." Lodginh forecasts presented in the June 2009 edition of Hote l Horizons are based on Smith Trave l Research hotel performance data through March 2009 and Moody'sz Economy.com's May 2009 economic forecast for the Given the correlation between employment and lodging the new expectation is for RevPAR to declins 17.5 percent in followed by another 3.5 percent declinwe in 2010. Year-over-year quarterlty declines in the demancfor U.S.
lodging accommodations started in the first quarter of 2008 and peakedr at negative 8 percent in the firsyt quarterof 2009. The June 2009 editionn of Hotel Horizons forecastsz demand to decline each of the remaining quarters of but at adiminishingg pace. The projected quarterly declines in demand for the remainder of 2009 averagesjust 4.7 percent. Beyond 2009, the forecas t calls for average annual increasesx in demandof 3.2 percen t for the next four years, well above the 1.9 percentr long-term average. But given the forecast 17.
5 perceny decline in RevPAR for allof PKF-HR is projecting totao hotel revenues to decrease 16 percent for the In 2011 and 2012, PKF-HR forecastd that RevPAR will increase on an averag annual basis of 9.2 percent, while profits will rise at a 17.8 percentf pace.
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