The third-quarter performance of extended-stay hotels in the United States set 14 new records for metrics including demand, occupancy, average daily rate and revenue per available room, according to the latest quarterly report from The Highland Group. Additionally, in the year-to-date metrics through September 30, budget extended-stay hotels set four new records, the average price set two and the upscale segment set a new demand high.
“It is very likely that long-stay hotels will continue to set new performance records in the near term,” Mark Skinner, partner at Highland Group, said in a statement.
According to the report, US long-stay hotel room demand in the third quarter was 40431, which represented a 25.7 percent year-over-year increase and the highest demand increase ever reported in any quarter for this segment. Supply growth, with various hotels closing and reopening due to the effects of the pandemic, was 6.3 percent over the same period, consistent with what was seen before the pandemic.
The overall extended stay occupancy level in the United States was 78.8 percent for the quarter, up 18.2 percent year over year. The economy class recorded the highest occupancy at 83.3 per cent, followed by the average price at 78.5 per cent. Both numbers represent third-quarter records for their levels and represent a full recovery of occupancy levels in the third quarter of 2019. However, occupancy in the upscale class, which accounts for about 40 percent of the supply of extended-stay rooms, was 77.2 percent. Although lower than other levels, the number represents a 30 percent year-over-year increase.
Ratings of the dynamic economy and average price performance exceeded 2019 levels and set new records in the third quarter. The average premium rate is 22.4 percent above its level in 2020 but is still about $9 lower than its level in 2019. The overall ADR for the extended residence sector in the United States was $104.96 for the quarter, about 98 percent of the The average for the third quarter of 2019.
RevPAR for the third quarter increased 48.5 percent year-over-year to $82.76. The three levels showed a significant improvement year-over-year, with the economy and room-availability-per-room outpacing Q3 2019 levels. The upscale RevPAR improved 59.1 percent year-over-year to $106.18, which is about 89 percent from the third-quarter level. for the year 2019.
Report: US Extended Residence Demand in the Second Quarter at a Record High