How U.S. hospitality seeks to hold onto high occupancy gains

The hotel industry is pushing some of the highest occupancy numbers on record, so high that in some cases markets are evolving their entire tourism strategy to accommodate the influx of new guests. 

According to the Charlotte Observer, Charlotte, N.C., is trading in its convention business for higher occupancy overall. Rather than discounting rooms to draw guests to conventions, Charlotte is currently holding an average daily rate of $104 -- the first time ADR has reached above $100 a night in history. The city's occupancy is at 72 percent, the highest it has been since 2007. Revenue per available room is expected to reach over $75 this year, where it was under $58 in 2007.

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Survival in these times is highly dependent on a hotel's ability to quickly adapt and pivot their business to meet the current needs of travelers and the surrounding community. Join us for Optimization Part 2 – a FREE virtual event – as we bring together top players in the industry to discuss alternative uses when occupancy is down, ways to boost F&B revenue, how to help your staff adjust to new challenges and more, in a series of panels focused on how you can regain profitability during this crisis.

Meanwhile, metro Atlanta is seeing numbers similar to its peak in 1995. AJC reported that in July the area's occupancy reached 80 percent, and is expected the year to end four points higher than last year at 70.1 percent. Atlanta has also seen slow addition to supply, with the construction of new stadiums for the Falcons and Braves taking priority, leading to the possibility of even greater occupancy and rates for the coming year. 

“If you say 2007 was the banner year for the industry in Charlotte, then 2012 matched that number,” said hotel executive Vinay Patel, a Charlotte Regional Visitors Authority board member. “And there have been increases ever since. The industry is at levels you haven’t seen before.”

September continued the upward trend in occupancy, according to data from STR. Year-over-year results show the U.S. industry's occupancy increased 3.5 percent to 67.9 percent for September 2015, compared to the year prior. Average daily rates were up 4.6 percent to $122.02, and revenue per available room increased 8 percent to $82.82.

This marks the 67th consecutive month to see gains in RevPAR for the industry. Anaheim/Santa Ana, Calif., saw the only double-digit rise in occupancy (up 10.3 percent to 78.1 percent), as well as the largest RevPAR increase (up 20.5 percent to $110.38). The market's ADR rose 9.3 percent to $141.34.

Anaheim is also on track to hold onto these occupancy gains, with residents moving to extend a moratorium on short-term rental leasing. Citywide there are currently 400 licensed home sharing properties, according to NBC Los Angeles, and another 170 are under review. 

"So we're trying to find that balance so that these short-term rental business can exist within the neighborhoods without disrupting the integrity of the neighborhoods," Ruth Ruiz, the city of Anaheim spokeswoman, told NBC. The city council is set to vote on the measure next week

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For the week of Sept. 6-12, occupancy reached 48.5 percent, down 1.6 percent from the previous week.