"While a combination of forces acted together to alter lodging demand and hotel occupancy in the first quarter, it is clear that unusual weather patterns played a role in some of the period's atypical lodging trends," says Bjorn Hanson, Ph.D., New York-based chairman of the Coopers Lybrand lodging and gaming group, creators of the Lodging Research Network.
In the Northeast, where El Nino imparted unseasonably warm and dry weather, first-quarter demand growth for hotel rooms was two percentage points higher than what it would have been given current levels of national and regional economic activity, according to the Lodging Research Network. Meanwhile, in the Mountain region, where E1 Nino cut snowfalls, demand growth for rooms was two percentage points below expected levels, www.lodgingresearch.com says. In the Pacific region, where weather was unusually chilly and wet, lodging demand growth was two percentage points below the expected pace.
A Boon for the Northeast
Overall, the U.S. experienced a 3.4 percent rise in lodging demand and,
largely because of new hotel supply, a 0.5 percent decline in hotel occupancy
in the first quarter of 1998 versus the first quarter of 1997, according
to Smith Travel Research data on the Lodging Research Network. But
the New England region experienced a boomlet. There the number of
rooms sold was a whopping 8.7 percent higher in the first quarter of 1998
than it was in the year-earlier period, while occupancy rates rose 6.8
percent, according to
Smith Travel Research data on www.lodgingresearch.com.
"Unseasonably warm weather in the Northeast clearly enticed a greater-than-usual number of travelers to the region and benefited Northeast hoteliers," Hanson observes. The number of rooms sold in New Hampshire alone was 10.6 percent higher in the first quarter of 1998 versus the same period in 1997, and occupancy in the state climbed 8.6 percent over the year-earlier period, according to Smith Travel Research data on the Lodging Research Network. In Maine, 18.5 percent more rooms were sold during the first quarter of 1998 versus 1997, and occupancy rose 19.0 percent.
But Pacific, Mountain States and Florida Suffer
In the first quarter, the Pacific region experienced some uncharacteristic and less beneficial trends: a lodging demand increase of just 0.6 percent -- and an occupancy drop of 1.4 percent, higher than the national average, according to Smith Travel Research data at www.lodgingresearch.com. The greater Santa Ana-Anaheim region alone experienced a 3.3 percent drop in the number of rooms sold and a 3.2 percent occupancy decline.
"These figures are unusual for the Pacific region in a typical first quarter, when many travelers head west for warmth and sunshine," Hanson observes. "Regrettably, those elements were in short supply in the Pacific region during the period studied," he adds.
The Mountain region experienced a scant 0.3 percent increase in the number of rooms sold and a 4.1 percent decline in occupancy in the first quarter of 1998 versus the year-earlier period, according to Smith Travel Research data on the Lodging Research Network. Utah alone experienced a 3.0 percent drop in the number of hotel rooms sold -- and a whopping 10.8 percent occupancy drop.
Florida experienced a 0.4 percent decline in the number of hotel rooms sold during the first quarter versus the year-earlier period -- notably below the national average 3.4 percent growth in demand. Florida hotel occupancy dropped 3.8 percent, according to Smith Travel Research data on the Lodging Research Network. In the Miami area, the number of rooms sold rose just 1.2 percent versus the same period in 1997, and occupancy fell 1.2 percent. "In a normal winter, cold temperatures in the Northeast send travelers south to Florida in great numbers," Hanson notes. "These figures show Florida clearly suffered from the warmer weather in the Northeast."
Coopers Lybrand's Lodging Research Network ( www.lodgingresearch.com ) makes available via the Internet Coopers Lybrand's renowned econometric forecasts for the lodging industry, breaking lodging industry news, an exclusive database of lodging industry real estate acquisitions, financial data of publicly traded lodging companies (including SEC filings), new hotel construction data, lodging census data from Smith Travel Research as well as an extensive research library that includes U.S. econometric and demographic statistics. For more information about the Lodging Research Network, call toll-free 800-576-6656. One of the world's leading professional services firms, Coopers Lybrand L.L.P. provides services for enterprises in a wide range of industries. The firm offers its clients the expertise of more than 19,000 professionals and staff located in 100 U.S. cities and, through the member firms of Coopers Lybrand International, more than 82,000 people in 138 countries worldwide.