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April 2018: TrevPAR Hits a High at Hotels in the U.S.

Total revenue levels at hotels in the U.S. hit a high of almost $290 per available room in April, as strong year-on-year revenue increases were recorded across all operating departments, according to the latest worldwide poll of full-service hotels from HotStats.

The TrevPAR measure encompasses the revenue generated across all operating departments at hotels in the U.S., which this month was led by a 5.6 percent year-on-year increase in revenue in the rooms department, as well as growth in non-rooms revenues, including food/beverage (+8.4 percent) and conference/banqueting (+11.6 percent) on a per available room basis.

The growth across all revenue centers fueled a 6.5 percent year-on-year increase in TrevPAR, which hit a post-GFC high of $287.53 per available room in April and meant revenue levels edged past the $285.87 achieved in this measure last month.

While growth in RevPAR included a 0.2 percentage point year-on-year increase in room occupancy to a robust 82 percent, it was led by the 4.6 percent increase in achieved average room rate, which was recorded at $218.78 this month, just short of the peak in this measure in March.

In addition to the growth in revenue, hotels in the U.S. were further buoyed by an increasingly uncommon decline in labor costs, which fell by 0.4 percentage points to 32.1 percent of total revenue. 

Profit & Loss Key Performance Indicators – U.S. (in USD)

April 2018 v April 2017

RevPAR: +5.6% to $179.32

TrevPAR: +6.5% to $287.53

Payroll: 0.4 pts to 32.1%

GOPPAR: +9.1% to $120.02

Flow Through +56.8%

As a result of the movement in revenue and costs, profit per room at hotels in the U.S. grew by 9.1 percent year-on-year in April, to $120.02, which was only just behind the previous high of $121.56 recorded in October 2017.

Additionally, the cost savings enabled hotels in the U.S. to record a profit flow through of 56.8 percent this month, highlighting the ability of hoteliers to drive profit levels during periods of positive performance.

The profit per room increase this month helped to shore up the year-to-date growth in bottom line performance at hotels in the U.S., which was recorded at +3.9 percent for the four months to April 2018, to $102.39.

“April marked another month of positive trading for hotels in the U.S. It’s very pleasing to see the high levels of conversion being achieved at a very punchy 41.7 percent of total revenue this month

Particularly notable is the healthy level of flow through where the less profitable non-rooms generating departments led the revenue growth,” said Pablo Alonso, CEO of HotStats.  

For hotels in San Francisco, the buoyant performance in April provided some respite from a fairly mixed period of trading since the beginning of the year.

Hotels in San Francisco posted an 18.9 percent year-on-year increase in TrevPAR in April, to $348.84, which was fueled by the week-long RSA security conference, which took place at the Moscone Center and helped boost demand for hotel accommodation across the city.

The annual conference welcomed more than 42,000 attendees in 2018, with 550-expert-led sessions and more than 650 exhibitors.

As a result, while occupancy levels broadly remained stable at 88.4 percent, hotels in San Francisco were able to leverage price to record a 16.3 percent year-on-year increase in achieved average room rate to $283.34, which fueled the 16.1 percent increase in RevPAR to $250.50.

The rate growth was led by a 27.0 percent year-on-year increase in the best available rate category, which soared by almost $70 to $314.29 and was by far the highest sector rate recorded at hotels in the city this month. Additionally, increases were also recorded in rate in the conference (+5.7 percent), corporate (+7.8 percent) and leisure (+22.5 percent) segments.

While it was a strong month of trading, hotels in San Francisco may have left some cash on the table as the data suggests that a significant proportion of roomnights were booked through third party intermediaries. This was evidenced by the 35.3 percent year-on-year increase in rooms cost of sales (i.e., HotStats’ measure of travel agents’ commissions, reservation fees, GDS fees, third-party fees and Internet booking fees), to $13.52 per available room, equivalent to 5.4 percent of rooms revenue.

Aside from this, it was a positive month for hotels in San Francisco as the weight of attendees to the RSA conference also fueled the appetite for ancillary facilities, which meant growth was successfully recorded in non-rooms revenues, including food & beverage (+29.9 percent) and conference/banqueting (+36.5 percent) on a per available room basis.

Profit & Loss Key Performance Indicators – San Francisco (in USD)

April 2018 v April 2017

RevPAR: +16.1% to $250.50

TrevPAR: +18.9% to $348.84

Payroll: -3.7 pts to 39.1%

GOPPAR: +35.0% to $133.55

Flow Through: 62.6%

Furthermore, the weight of revenue growth enabled hotels in San Francisco to record a saving in labor costs, which fell by 3.7 percentage points to 39.1 percent of total revenue and contributed to the 35.0 percent year-on-year increase in profit per room in April to $133.55. 

Further down the Pacific coastline, while hotels in San Diego also recorded a positive month of trading, it was well behind the year-on-year growth in San Francisco.

The 3.1 percent increase in TrevPAR, to $309.29, continued the mixed performance in San Diego since the beginning of 2018.

“Despite a 1 percent increase in profit per room for the month, to $143.78, flow through was recorded at just 16.1 percent, way below the industry average expectation of 50% flow, which continues to highlight the challenges operators are facing with tightening profit margins in a period of increasing operating costs,” added Pablo.

Profit & Loss Key Performance Indicators – San Diego (in USD)

April 2018 v April 2017

RevPAR: +2.6% to $197.82

TrevPAR: +3.1% to $309.29

Payroll: +1.5 pts to 28.5%

GOPPAR: +1.0% to $143.78

Flow Through: 16.1%

 
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Toronto, ON (May 17, 2018)Atlific Hotels is proud to announce the recently completed renovations of Hilton Garden Inn Toronto Airport West/Mississauga. Designed by Robert J. Chaban & Associates, the hotel’s public spaces and guestrooms have been updated in a style that is inspired by nature and elevates the property’s welcoming and contemporary environment. 

“We are delighted with the hotel’s new look and are confident that guests will be captivated with its laid-back sophistication,” said Philippe Gadbois, Senior Vice-President Operations, Atlific Hotels. “In addition to revitalizing the property’s atmosphere, the completed renovations include thoughtful touches that will improve the overall guest experience and allow us to better serve our clientele,” he continued.

Renovations to public and private spaces comprise new furnishings and carpet, enhanced lighting elements, refreshed paint and garden-inspired artwork that has brightened the lobby and added texture to meeting spaces. Upon arrival, the lobby welcomes guests with alluring, geometric floor-to-ceiling curtains. The dimensional fabric shines thanks to unique lighting fixtures that hang in the middle of the entrance. 

Business travellers desiring a private space can now enjoy the new Garden Room, an enclosed boardroom with a serene ambience. With doors to facilitate privacy, new furnishings and carpeting, window treatments and a TV, this space is also ideal for professionals who wish to host meetings or conduct presentations.   

Inside guestrooms rich colours and natural materials inspire warmth and offer a calm respite from the outside world. Welcoming and comfortable beds have been backed with upholstered headboards, accent lighting and sleek, white nightstands. Rustic, wooden planks add texture to the headboards, bringing a touch of nature to the contemporary space. The wood also adds dimension to the otherwise modern atmosphere, with white, grey and silver tones playing an integral role in the room. Fresh, white, floating bedside nightstands perfectly add polish along with crisp white bedding and blinds to match. Subtle pops of red appear throughout eclectic art atop the headboard, desk and red accent lounge chair, adding a vibrant touch to the clean and inviting environment. A modern and multifunctional desk serves as a workspace with ample storage, making this space perfect for both business and leisure travellers alike. 

Set in the heart of the Mississauga Business District, the hotel is a nine-minute drive to Toronto Pearson International Airport and provides easy access to popular attractions such as Square One Shopping Center, Hershey Center and Living Arts Centre, where plays, concerts and classical events are regularly held. 

 
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SHELTON, Conn. - -May 11, 2018— New Castle Hotels & Resorts, a leading third-party hotel management company, owner and developer today announced that longtime president and COO Gerry Chase will retire from NCHR effective June 30, 2018.   Founded by David Buffam in 1980, New Castle will be led by sons Jeremy Buffam and Julian Buffam in the future. 

                Chase joined the company in 1988 and oversaw hotel operations and later development efforts of more than 80 hotels and resorts.  Chase began his hospitality career as a bellman, rising through the ranks of Marriott International, and later holding executive positions with Interstate Hotels and Resorts before partnering with Buffam to build New Castle. 

                “David offered me the opportunity of a lifetime when he welcomed me into his family business, and after 30 years it’s time to turn over the keys to a new generation,” said Chase.  “We have a strong executive team in place, a robust development pipeline and a very successful portfolio of owned and operated hotels that each are market leaders.  I can move into this next phase confident that our associates, investors, partners and hotels are all well positioned for continued prosperity.

                Chase has been a dedicated industry collaborator serving on numerous brand advisory boards as well as the board of the American Hotel & Lodging Association and the American Hotel and Register Company.  In 2015, he was awarded the prestigious Arthur Landstreet Award, which is presented annually to an individual who has made a lasting impact on the quality of education and training in the hospitality industry.

 

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