While overall industry occupancy and demand have slowed as compared with three weeks ago, ADR continued to strengthen to an all-time high (almost $140) that was 5% above the 2019 comparable. More than 71% of markets reported higher weekly ADR versus the comparable week in 2019. However, a week ago, that figure was at 85%. Weekday ADR was the highest since the start of the pandemic, while weekend ADR fell back down from its high last week and was the second highest ever. Top 25 ADR continued to grow but remained below the levels seen in 2019 and early 2020. Non-Top 25 ADR was at a record level.
Although all measures of U.S. occupancy and demand show a moderation from highs achieved three weeks ago, it’s too early to claim we have peaked. There are countless potential explanations. It’s been too early to rejoice that recovery is in hand but it’s also too early to fear we are falling back into despair. History has taught us that the recovery will not be linear nor universal. Our current dependency on leisure demand means that we will likely see more weekly fluctuations than usual.
Week ending 10 July
Following the normal pre-4th of July slump, U.S. industry occupancy rebounded to 67.2% for the week ending 10 July 2021. While this was good news, the gain was much less than expected as weekly demand improved 3% to 26 million. In the same week of 2019, demand increased 13% week over week, and occupancy hit 74%. We believe this illustrates the continued shortfall in business and group demand that in normal times would have supplemented seasonal leisure demand. Daily occupancy peaked again on Saturday at 80%, which was the fourth time this year that Saturday’s occupancy was above 80%. Sunday, 4 July occupancy (66%) was solid but not as strong as on Memorial Day Sunday (68%). Despite the higher Sunday occupancy, weekday occupancy was virtually unchanged from the previous week (+0.2 points) and 2.6 points lower from its high three weeks ago. On a total-room-inventory basis (TRI), which accounts for temporarily closed hotels, weekly occupancy was 64.7%.
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