By Rob Starr, Content Manager, Big4.com
Reflecting slower near-term economic growth, weaker third-quarter results, and the impact of Superstorm Sandy, an updated lodging forecast released today by PwC US anticipates slower revenue per available room (“RevPAR”) growth in 2012 and 2013, compared to the previous outlook.
The outlook for lower RevPAR growth reflects impacts from three sources: third quarter results that came in lower than anticipated, particularly due to performance in September; a more pessimistic macroeconomic outlook, which now calls for slower growth in the second half of 2012 than previously anticipated; and the effects of Superstorm Sandy.
The updated estimates in PwC Hospitality Directions US are based on a quarterly econometric analysis of the lodging sector, using historical statistics supplied by Smith Travel Research and other data providers, and an updated macroeconomic forecast released from Macroeconomic Advisers, LLC. Macroeconomic Advisers’ November outlook anticipates slower economic growth in 2012 than previously anticipated, primarily due to reduced business confidence and investment, despite reduced uncertainty associated with the Eurozone debt crisis and evidence that consumer confidence and spending have improved.
“The lodging recovery is being tested by a period of slower economic growth and recent disruptions related to Superstorm Sandy,” said Scott D. Berman, principal and U.S. industry leader, hospitality & leisure, PwC. “Despite these challenges, the trajectory of the recovery remains positive and we anticipate higher occupancy levels and stronger average daily rate growth in 2013.”