Latest data from STR indicate a rapid growth in the US hotel market. According to their March 2023 profit and loss (P&L) data release, US hotel total revenue per available room (TRevPAR) set a new monthly record, reaching $238.22, which represents a year-on-year increase of 17.5%.
The key P&L metrics all showed double-digit growth year-on-year, including gross operating profit per available room (GOPPAR) which reached $95.12, a rise of 14.5%.
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The rise in TRevPAR helped to alleviate pressure from the 23.4% increase in total labour costs per available room (LPAR), ensuring that profit margins remained strong.
TRevPAR is a reliable measure of performance
TRevPAR offers a key advantage as a measure of hotel performance, as it takes into account revenue from all departments including food and beverage sales, meeting space, spas, golf, parking and even phone/internet services.
These elements can all have a significant impact on a hotel’s overall performance, particularly that of full-service hotels which tend to feature the most extensive food and beverage offerings.
TRevPAR also covers miscellaneous income, such as cancellation and resort fees, which could otherwise be easy to overlook in the overall performance equation.
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By GlobalDataTop 25 markets report strong growth
All of the top 25 markets reported GOPPAR levels above those in March 2022, with group-dependent markets leading the way.
New York City showed the highest GOPPAR gain, indicating that group travel has resumed and is contributing to the industry’s recovery.
Although Los Angeles was the only major market to realise a TRevPAR level lower than its comparable figure, there are no longer any top markets with negative TRevPAR or GOPPAR comparables.
The report demonstrates the continued recovery of the US hotel industry, with key metrics showing sustained growth during March and April 2023.
The industry is expected to continue to rebound. It remains to be seen whether this trend will continue in the coming months.
