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Wed, 27 April 2016

Hotels in Central/South America Report Q1 2016 Decrease in Occupancy

According to Q1 2016 data compiled by STR, hotels in the Central/South America region recorded positive results in two of the three key performance metrics when reported in U.S. dollar constant currency.

Compared with Q1 2015, hotels in the Central/South America region reported a 4.6% decrease in occupancy to 55.8%, a 9.7% increase in ADR to US$96.39, and a 4.7% rise in RevPAR to US$53.79.

Performance of featured countries for Q1 2016 (local currency, year-on-year comparisons):

Argentina saw a 3.7% decrease in occupancy to 56.4% but significant growth in ADR (+54.8% to ARS1,637.70) and RevPAR (+49.1% to ARS923.90) due to the sharp devaluation of the Argentine peso and high inflation. When looking at individual months, March produced a 61.7% spike in RevPAR to ARS1,001.45 with occupancy aided by a visit from U.S. President Barack Obama and a FIFA World Cup qualifier between Argentina and Bolivia. In U.S. dollar terms, Argentinas ADR for the quarter dropped 8.1%.

Colombia recorded a 5.0% rise in occupancy to 58.0% as well as double-digit growth in ADR (+10.0% to COP281,624.47) and RevPAR (+15.5% to COP163,452.71). A 10.7% increase in demand for the quarter was more than enough to outweigh a 5.5% rise in supply. In addition, rates were increased during a time of weakness for the Colombian peso.

Costa Rica experienced increases in occupancy (+4.3% to 76.5%) and RevPAR (+2.0% to CRC65,853.67), while ADR fell 2.2% to CRC86,067.27. Demand remained strong in the quarter (+5.2%), while supply was relatively flat (+0.9%). As a result, occupancy reached its highest level for a quarter since Q1 2008.

Performance of featured markets for Q1 2016 (local currency, year-on-year comparisons):

Panama City, Panama, reported nearly flat occupancy (+0.4% to 55.1%) as well as decreases in ADR (-2.4% to PAB101.86) and RevPAR (-2.0% to PAB56.13). Supply (+3.2%) and demand (+3.6%) grew at a similar pace during the quarter, although demand fell 0.9% in March.

Rio de Janeiro, Brazil, saw a 2.0% dip in occupancy to 63.5% but a 3.8% increase in ADR to BRL501.93 pushed RevPAR up 1.8% to BRL318.60. Rio de Janeiro has reported double-digit supply growth for nine consecutive months as the market prepares for the 2016 Olympics. Strong demand growth (+10.6%) through the first quarter of the year softened the impact of new supply on occupancy.

Quito, Ecuador, reported double-digit declines in occupancy (-21.6% to 54.1%) and RevPAR (-20.3% to US$59.23). ADR in the market was up 1.7% to US$109.53. Q1 2016 followed a trend of double-digit occupancy decreases in Quito since the eruption of the Cotopaxi volcano. As occupancy falls, hoteliers have placed more of an emphasis on rate to maximize revenue.

 Central/South America performance for March 2016 (U.S. dollar constant currency, year-on-year comparisons):

Compared with March 2015, the Central/South America region reported a 7.5% decrease in occupancy to 56.6%. ADR was up 7.6% to US$95.51. RevPAR remained nearly flat (-0.5% to US$54.02).

See other recent news regarding: STR, ADR, RevPAR

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