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STR Reports Global Hotel Performance for March 2011

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According to data compiled by STR Global, hotels in the Asia Pacific region experienced mostly positive results in the three key performance metrics during March 2011.

In year-on-year measurements, the Asia Pacific region's occupancy fell 3.5% to 66.5%, the ADR increased 13.8% to US$144.04, and RevPAR jumped 9.9% to US$95.77.

In the first quarter of 2011, the Asia Pacific region was virtually flat in occupancy, reporting a 0.2% decrease to 64%. ADR was up 13.1% to US$143.81, and RevPAR increased 12.8% to US$92.03.

"This month we saw the impact of the earthquake, tsunami and its aftermaths on the Japanese hotel market," said Elizabeth Randall, managing director of STR Global. "Across Japan, occupancy declined 21% for the month in addition to a slight drop in average rate. Cities in the southern parts of Japan performed better than cities closer to the affected north-eastern area as people moved farther away from the threat of radiation exposure. Tokyo's occupancy moved from 83% in March 2010 to 55% this year, and its average room rate (-4%) dropped slightly more than the national average (-0.1%) to JPY14,181. Osaka's occupancy, in comparison, dropped only slightly by 2.8% to 81%, and its average rate increased 10% to JPY12,083. In the city of Sendai, where we usually track the performance of nine hotels, three properties closed and the March performance of six reporting hotels showed a decline of 23% in RevPAR."

"Asia Pacific overall finished the first quarter 2011 with a level occupancy performance and increases in average room rate to gain 13% in RevPAR," Randall continued. "As we saw a strong demand recovery in 2010, we expect to see occupancy performance level out and average room rates grow. Asia Pacific achieved the highest occupancy (64%) of the four world regions in the first quarter."

Highlights from key market performers for March 2011 in local currency (year-on-year comparisons):

- Bangkok, Thailand, increased 10% in occupancy to 67.8%, reporting the largest increase in that metric, followed by Jakarta, Indonesia, with a 6% increase to 71.9%.

- Five markets experienced double-digit ADR increases: Hong Kong, China (+28.2% to HK$2062.02); Jakarta (+14.5% to IDR809282.30); Bali (+12.8% to IDR1092414.91); Beijing, China (+10.3% to CNY698.32); and Seoul, South Korea (+10% to KRW193755.16).

- Hong Kong jumped 33.2% in RevPAR to HK$1790.77, followed by Jakarta with a 21.4% increase to IDR582069.77).

Highlights from key market performers for March 2011 (year-on-year comparisons, all currencies in U.S. dollars):

- Hong Kong achieved the largest ADR increase, rising 27.8% to US$264.74.

- New Delhi, India, ended the week virtually flat with a 0.8% ADR decrease to US$199.10, reporting the only decrease in that metric.

- Four markets experienced RevPAR increases of more than 20%: Hong Kong (+32.8% to US$229.92); Brisbane, Australia (+27.8% to US$167.49); Jakarta (+26.2% to US$66.53); and Sydney (+25% to US$177.48).

The Americas

In the first quarter of 2011, the Americas region experienced a 5.5% increase in occupancy to 55.3%, a 3.1% rise in ADR to US$102.60, and an 8.8% jump in RevPAR to US$56.74.

The Americas region ended February with a 5.8% increase in occupancy to 61.6%, ADR was up 3.9% to US$104.90, and RevPAR rose 9.9% for the month to US$64.62.

Among the key markets in the region, Santiago, Chile, experienced the largest occupancy increase, rising 73.9% to 84.6%, followed by Mexico City, Mexico, with a 14% increase to 67%. Sao Paulo, Brazil, fell 7.5% in occupancy to 66.6%, reporting the largest decrease in that metric, followed by New York, New York, with a 4.1% decrease to 78.2%.

Rio de Janeiro, Brazil, reported the largest ADR increase, rising 40.9% to US$251.53, followed by Sao Paulo with a 26.3% increase to US$141.16. Vancouver, Canada, posted the only ADR decrease, falling 1.8% to US$130.43.

Santiago (+79.5% to US$143.61) and Rio de Janeiro (+44.3% to US$197.37) achieved the largest RevPAR increases for the month. Vancouver fell 0.6% in RevPAR to US$79.81, reporting the only decrease among the region's key markets.

Europe

In first quarter 2011, Europe reported increases in all three key performance metrics. The region's occupancy rose 3% to 56.4%, its ADR was up 5.7% to EUR98.30, and its RevPAR increased 8.9% to EUR55.44.

"The Europe hotel industry reported solid performance during the first quarter of 2010, continuing its steady growth with gains in occupancy and average room rate," said Ms. Randall. "All European subregions achieved occupancy and rate growth for the month and the quarter."

Highlights from key market performers for March 2011 include (year-on-year comparisons, all currency in euros):

- Venice, Italy, achieved the largest occupancy increase, rising 32.5% to 65.7%, followed by Oslo, Norway, with a 22% increase to 68.3%.

- Two markets reported occupancy decreases of more than 5%: Malmo, Sweden (-9.4% to 55.7%), and Salzburg, Austria (-6.2% to 55.9%).

- Four markets experienced ADR increases of more than 20%: Cologne, Germany (+26.2% to EUR119.65); Istanbul, Turkey (+24.4% to EUR150.33); Vienna, Austria (+24.4% to EUR109.33); and Zurich, Switzerland (+21.6% to EUR211.94).

- Six markets achieved RevPAR increases of more than 30%: Venice (+54.7% EUR136.74); Cologne (+44.9% to EUR86.98); Oslo (+33.8% to EUR87.18); Vienna (+33.2% to EUR81.24); Gothenburg, Sweden (+32.3% to EUR71.90); and Istanbul (+31.0% to EUR108.43).

- Salzburg fell 9.7% in RevPAR to EUR40.73, reporting the largest decrease in that metric.

Middle East / Africa

The region's occupancy ended the month with a 12.9% decrease to 57.8%, its ADR rose 9% to US$172.89 and RevPAR fell 5.1% to US$99.98.

In first quarter of 2011, the Middle East Africa region's occupancy fell 7.8% to 56.8%, its ADR was up 9.4% to US$176.31, and RevPAR experienced a slight increase, rising 0.9% to US$100.17.

"Hotel performance across Northern Africa and parts of the Middle East continue to be influenced by events in the region," Ms. Randall said. "The most significant monthly RevPAR declines (in local currency) of the countries we track were reported in Bahrain (-79%) and Egypt (-68%). Occupancy is the main driver of the declines, as both markets reported occupancies of only 25%. Despite these events, the Middle East Africa region again achieved the highest average room rate of the four world regions (US$176) and ended the first quarter with a slight RevPAR growth resulting from declining occupancy levels and growing average room rates. The declining occupancy levels should be a temporary feature, and we expect to see improvement as soon as the political situation in each country stabilises."

Highlights among the region's key markets for March include (year-on-year comparisons, all currency in U.S. dollars):

- Abu Dhabi, United Arab Emirates, experienced the only double-digit occupancy increase, rising 13% to 71.2%.

- Cairo, Egypt, fell 67.9% in occupancy to 23.3%, reporting the largest decrease in that metric, followed by Beirut, Lebanon, with a 25% decrease to 47.9%.

- Johannesburg, South Africa, rose 17.0% in ADR to US$119.33, reporting the largest increase in that metric.

- Abu Dhabi posted the largest decrease, falling 21.3% to US$176.72.

- Three markets experienced RevPAR increases of more than 5%: Cape Town, South Africa (+8.5% to US$109.67); Johannesburg (+7.1% to US$66.71); and Jeddah, Saudi Arabia (+5.2% to US$137.02).

- Three markets ended the month with RevPAR decreases of more than 20%: Cairo (-70% to US$27.40); Beirut (-29.9% to US$91.49); and Amman, Jordan (-20.4% to US$76.76).

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