As leaves fall this autumn, expect rates to go up
Posted by Patrick Mayock at 12:00 AM
 

Well, here we are folks. It’s the day after Labor Day and thus the unofficial end to the summer travel season for the U.S. hotel industry. Time to pack up the suntan lotion and beach towels and pull out the hooded sweatshirts and pigskin. Fall is finally upon us.

Browns running back Peyton Hillis celebrates after a preseason touchdown against the Green Bay Packers. With the return of football and the fall travel season, hoteliers might find themselves celebrating in a similar manner after booking higher-rated corporate business.

I, for one, couldn’t be more excited. While I enjoy a sun-soaked day sitting poolside as much as the next fella, I’m an even bigger fan of crisp autumn afternoons, hot apple cider and tailgating before rooting on my beloved Cleveland Browns.

(Side note: I’ve finally managed to convert my wife to the miserable world of a Browns backer. This will be the first year we enter the NFL season where she’ll be throwing her full-fledged support behind the boys in the orange and brown. I’m interested to see how long she lasts as a fan—or my wife. The suffering associated with recruiting anyone to be a Browns supporter is grounds for divorce in most states, I’m sure.)

I know many hoteliers take a similar stance—about the fall season, that is, and not so much the Browns. While leisure travel will begin to taper off, the next three months typically welcome a return of the corporate customer and their higher-rated (!!!) business (emphasis intentionally added).

While the summer months have been strong, growth in average daily rate has been muted. The June numbers from HotelNewsNow.com’s parent company STR show a gain of 3.5%, while hoteliers in July reported an increase of 3.9%. While hoteliers no doubt welcome any growth in that metric, they still have a long way to go until they’ve recovered from the double-digit declines felt during the recession.

While overall occupancy isn’t as strong as it has been, you’ll see the slowdown is more than made up for with the increases in ADR in the business sector—with, perhaps, the exception of October.

Which brings us back to fall …

I asked our friends at TravelClick to pull their forward-booking data for the Top 25 U.S. markets to give us a sense of how the next three months might shape up. The news, I’m happy to report, is good. Here’s a rundown:

September
Business Travel
Occupancy +0.8%
ADR +7.9%

Overall Travel Industry
Occupancy +1.1%
ADR +7.7%

October
Business Travel
Occupancy 0%
ADR +8.6%

Overall Travel Industry
Occupancy +5.7%
ADR -1.5%

November
Business Travel
Occupancy +4.4%
ADR +6.2%

Overall Travel Industry
Occupancy +5%
ADR +5.7%

Combine those three months together, and hoteliers have a picture that’s as pretty as the brightly colored leaves on an October afternoon in New England:

Top 25 Markets for All 3 Months
Business Travel
Occupancy +1%
ADR +7.8%

Overall Travel Industry
Occupancy +1.1%
ADR +6.9%

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