Hotels in Asia Pacific Report Mixed Results for July 2012

According to data compiled by STR Global, hotels in the Asia Pacific region experienced mixed results in the three key performance metrics for July 2012 when reported in U.S. dollars.

In year-on-year measurements, the Asia Pacific region's occupancy decreased 2.2% to 68.3%, its ADR ended the month virtually flat with a 0.2% increase to US$136.06 and its RevPAR was down 2.1% to US$92.86.

"Thailand and French Polynesia were the two out of 15 countries tracked on our Asia Pacific Hotel Review that reported double-digit RevPAR increases for July 2012 compared to July last year," said Elizabeth Randall Winkle, managing director at STR Global. "Thailand had its best July occupancy performance since 2006, with 67.8% for July 2012, just beating its July 2006 performance of 67.1%. Its ADR (THB3,062) for the month is still below its July 2008 peak of THB3,315. We have seen demand for hotel accommodation across the country increasing for the seven months this year (+10.3%) resulting as well from the increase in international visitors, especially from China, as reported by the Tourism Authority of Thailand."

"French Polynesia also reported its best July occupancy since July 2006 achieving 70.4% for July 2012, beating the last peak of July 2007 (68.1%). After the heavy occupancy declines seen in 2009 due to the global economic downturn, the islands had been reporting monthly occupancy and demand increases for the majority of months since 2010. A reduction in room inventory in the same period has helped to boost performances. Looking at the average room rate, July 2012 was its best performance of a July in the last six years."

Highlights from key market performers in July 2012 in local currency (year-on-year comparisons):

Hanoi, Vietnam, rose 23.7% in occupancy to 64.8%, posting the largest increase in that metric.

Jakarta, Indonesia (-10.3% to 73.1%), and Kuala Lumpur, Malaysia (-10.0% to 78.4%), reported the largest occupancy decreases for the month.

Jakarta achieved the largest ADR increase, rising 21.6% to IDR954,878.37, followed by Taipei, Taiwan (+18.6% to TWD5,554.87), and Phuket, Thailand (+16.9% to THB3,155.18).

Three markets experienced RevPAR increases of more than 15%: Phuket (+26.2% to THB2,309.32); Hanoi (+25.0% to VND1,432,239.53); and Tokyo, Japan (+19.9% to JPY11,375.45).

Delhi, India, fell 14.4% in RevPAR to INR3,383.47, reporting the largest decrease in that metric.

Highlights from key market performers for July 2012 in U.S. dollars (year-on-year comparisons):

Taipei rose 14.0% in ADR to US$184.71, reporting the largest increase in that metric. Beijing, China, followed with a 13.1% increase to US$107.26.

Two markets experienced ADR decreases of more than 20%: Delhi (-27.3% to US$111.72) and Mumbai (-22.1% to US$132.94).

Three markets achieved RevPAR increases of more than 15%: Hanoi (+22.3% to US$67.92); Phuket (+20.9% to US$73.08); and Tokyo (+17.6% to US$145.27).

Delhi (-30.7% to US$61.08) and Mumbai (-19.6% to US$74.15) posted the largest RevPAR decreases for the month.

Americas

The Americas region reported a 0.5% increase in occupancy to 70.0%, a 3.3% gain in ADR to US$109.61 and a 3.8% increase in RevPAR to US$76.74.

Among the region's key markets, Mexico City, Mexico, rose 6.3% in occupancy to 63.9%, reporting the largest increase in that metric. Rio de Janeiro, Brazil, followed with a 3.1% increase in occupancy to 75.2%. Buenos Aires, Argentina, fell 20.5% in occupancy to 55.9%, posting the largest decrease in that metric, followed by Montreal, Canada (-12.7% to 68.2%), and Panama City, Panama (-10.4% to 49.2%).

San Francisco, California, experienced the largest ADR increase, rising 11.9% to US$176.52, followed by Boston, Massachusetts, with a 10.8% increase to US$160.75. Buenos Aires (-12.6% to US$129.28) and Sao Paulo, Brazil (-11.7% to US$126.41) posted the largest ADR decreases for the month.

San Francisco (+11.5% to US$154.50) and Boston (+11.2% to US$133.23) achieved the highest RevPAR increases for the month. Three markets experienced RevPAR decreases of more than 15%: Buenos Aires (-30.5% to US$72.32); Montreal (-20.3% to US$88.12); and Panama City (-16.7% to US$58.35).

U.S.

Overall, the U.S. hotel industry's occupancy rose 0.5 percent to 70.0%, its ADR was up 3.8% to US$107.44 and its RevPAR increased 4.3% to US$75.25.

Demand during July increased 1% with 105,964,171 rooms sold, breaking the July 2011 record of 104,957,596 rooms sold.

"The industry sold more rooms in the month of July than in any other single month since STR began tracking industry performance in 1987," said STR's COO, Brad Garner. "Record levels of demand will continue to stimulate ADR growth, particularly as group rooms sold firms in the historically heavy convention months of September, October and November. Discount-conditioned consumers will continue to experience a shift to a seller's market with magnitude likely accelerating in 2013."

Among the Top 25 Markets, New Orleans, Louisiana, rose 10.6% in occupancy to 68%, reporting the largest increase in that metric. Oahu Island, Hawaii, followed with a 10.3% occupancy increase to 91.8%. Phoenix, Arizona, fell 3% in occupancy to 46.5%, posting the largest decrease in that metric.

Four markets experienced double-digit ADR increases: Oahu Island (+15.8% to US$195.12); San Francisco/San Mateo, California (+11.9% to US$176.52); New Orleans (+11% to US$117.23); and Boston, Massachusetts (+10.8% to US$160.75). Phoenix ended the month with the largest ADR decrease, falling 1.3%to US$76.50.

Three markets achieved RevPAR increases of more than 15%: Oahu Island (+27.7% to US$179.20); New Orleans (+22.8% to US$79.72); and Houston (+16% to US$56.63). Phoenix fell 4.3% in RevPAR to US$35.60, reporting the largest decrease in that metric.

Europe

The European hotel industry posted mixed results in year-on-year metrics when reported in U.S. dollars, euros and British pounds for July 2012.

"European hotels reported a solid increase in average room rates for the month of July when measured in euro terms (+7.0%). However, this is coupled with the third consecutive month of small occupancy declines," said Ms. Randall Winkle. "With the Olympic coverage taking over a bit from the ongoing troubles in the eurozone, London (U.K.) hoteliers reported weaker occupancy performances in June and the non-Olympic days in July compared to last year. We receive monthly results from more than 422 hotels in London and results for July reflect that the first four days of the Olympics during July could not offset the weaker occupancy in the early part of the month. London reported 80.7% occupancy (a decline of 11.1 percentage points) and £166.34 average room rate (+8.8%) compared to July 2011. This occupancy result for July 2012 still puts London into the top eight out of 31 European capital or gateway cities, which we track on our European Hotel Review. Given the most of the Olympic events occurred in August, a bigger impact, especially in ADR terms, should be visible in London's August results."

Highlights from key market performers for July 2012 include (year-on-year comparisons, all currency in euros):

Bratislava, Slovakia, reported the largest occupancy increase, rising 19.5% to 51.2%, followed by Vilnius, Lithuania, with a 10.6% increase to 78.7%.

Two markets experienced double-digit occupancy decreases: London (-12.1% to 80.7%) and Istanbul, Turkey (-10.6% to 72.7%).

Four markets achieved ADR increases of 15% or more: Reykjavik, Iceland (+26.1% to EUR129.63); London (+22.1% to EUR212.91); Manchester, U.K. (+18.5% to EUR80.76); and Istanbul (+15.0% to EUR176.84).

Geneva, Switzerland (-15.1% to EUR242.25), and Zurich, Switzerland (-11.5% to EUR183.69), ended the month with the largest ADR decreases.

Reykjavik grew 32.2% in RevPAR to EUR119.54, achieving the largest increase in that metric.

Geneva fell 21.5% in RevPAR to EUR160.65, reporting the only RevPAR decrease of more than 20%.

Middle East/Africa

The region's occupancy decreased 4.9% to 56.7% during the month, its ADR increased 2.1% to US$140.67 and its RevPAR fell 3.0% to US$79.72.

"Ramadan, which took place 20 July to 19 August, impacted the results across the Middle East," Ms. Randall Winkle said. "Ramadan took place during August last year. The Holy cities of Makkah and Medina reported RevPAR increases of 90.9% and 33%, respectively. When measured in local currency, Beirut (Lebanon) reported sharp RevPAR declines (-39.2%) for July 2012 compared to last year as the Syrian crisis has deterred travellers to neighbouring Lebanon. July is the first month that average room rates and occupancy declined by around 20%."

Highlights among the region's key markets for July 2012 include (year-on-year comparisons, all currency in U.S. dollars):

Sandton, South Africa, and the surrounding areas, reported the largest occupancy increase, rising 10.3% to 61.1%.

Jeddah, Saudi Arabia (+7.9% to US$228.98), and Amman, Jordan (+7.0% to US$156.58) achieved the largest ADR increases for the month.

Jeddah was the only key market to report a RevPAR increase, rising 12.7% to US$191.53.

Beirut ended the month with the largest decreases in all three key performance metrics. Its occupancy fell 19.3% to 53.9%, its ADR was down 25.2% to US$195.78 and its RevPAR decreased 39.6% to US$105.48.

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