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for Robust Lodging Demand Recovery in 2004 |
October 9, 2003 - According to PricewaterhouseCoopers' September 2003 Hospitality Directions Forecast Alert, the strong lodging demand growth experienced in the late summer is the beginning of momentum for robust lodging demand increases in 2004 of 4.0 percent. Given slight upward revisions to already strong real GDP growth forecasts and lower inflation forecasts in the next two years, PricewaterhouseCoopers now forecasts RevPAR (revenue per available room) to stabilize in 2003 at 0.2 percent, and then increase by 4.9 percent in 2004 and 3.4 percent in 2005. PricewaterhouseCoopers forecasts that between the second and the fourth quarters of 2003, seasonally adjusted lodging demand will increase by 4.2 percent. This translates to a 3.2 percent improvement in occupied room nights in the second half of 2003 over the same period in 2002. Seasonally adjusted occupancy will rise to 60.1 percent by the fourth quarter of 2003 from 58.1 percent in the second quarter. "The strenghtening economy, evidenced by the recovery of the equity markets and corporate profits are precisely what the lodging industry needs for business travel to increase, the necessary ingredient for a robust and sustained positive trend in industry performance." said Bjorn Hanson Ph.D., Global Industry Leader, PricewaterhouseCoopers Hospitality & Leisure Practice. "The cumulative improvements in the next two years will help regain 37 percent of the 14.4 percent cumulative loss in real RevPAR in the 2001 to 2003 period." Key predictions from the PricewaterhouseCoopers include:
Emerging improvements in business/corporate activity that began in the second quarter of 2003, will gain momentum and lead to increases in lodging demand, especially benefiting ADR in the upper upscale segment. The upscale and midscale without food and beverage (F&B) segments will also experience larger than average increases in business travel demand. PricewaterhouseCoopers Hospitality & Leisure research specialists develop lodging industry forecasts using econometric models. They assist clients in understanding past and future lodging industry trends. Hospitality & Leisure research specialists have applied advanced statistical and econometric techniques on a variety of engagements, making a difference to clients' profitability, market share, strategic direction, and visibility in the marketplace.
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Contact:
PricewaterhouseCoopers Bjorn Hanson, Ph.D. www.pwc.com |
Also See: | PricewaterhouseCoopers Forecasts Lodging Industry Expenses Will Rise in 2003 / February 2003 |