Occupancy and Room Rates Rose Markedly From Year-Ago Period, Firm Says

NEW YORK, April 28, 1997/ -- First-quarter 1997 occupancy rates for Manhattan hotels increased a substantial 6.4 percent over first-quarter 1996 levels to 76.4 percent, according to information gathered by the hospitality consulting practice of Coopers Lybrand L.L.P. In the first quarter, average daily room rates for Manhattan hotels rose 10.7 percent over the year-earlier period to $166.58 from $150.50, Coopers Lybrand reported.

"These strong first quarter results bode well for 1997 overall, as the first quarter is traditionally Manhattan's softest period," commented Arthur Adler, principal in Coopers Lybrand's hospitality consulting group in Manhattan. "The first-quarter rise in occupancy over 1996 levels is especially impressive when one recalls that 1996 was characterized by the highest occupancy rates since 1982."

Four out of five hotel types in Manhattan -- tourist-class, convention, first-class and deluxe hotels -- reported occupancy increases for the first quarter of 1997 over the first quarter of 1996, according to Coopers Lybrand. Tourist-class properties showed the greater occupancy rise, from 67.0 percent to 77.4 percent -- a boost of 15.5 percent. In Manhattan, only luxury hotels experienced an occupancy drop, from 71.3 percent in the first quarter of 1996 to 70.3 percent in the first quarter of 1997, Coopers Lybrand found.

"Still, the strength of the lodging market is evident across all hotel types, including luxury hotels," Adler explained. "In a robust environment such as this, upscale hotels do well by maintaining premium room rates. That shifts more price-sensitive, volume and wholesale customers toward tourist-class properties."

Occupancy to Remain High, Rates to Rise, Coopers Lybrand Survey Finds

Surveyed by Coopers Lybrand's hospitality consulting group, Manhattan hoteliers say they anticipate occupancy to remain at current levels through the second quarter of 1997. But the hoteliers also anticipate that average daily room rates will rise 10 percent in the second quarter. "The average daily rate increase results not just from hoteliers boosting 'rack rates', or posted room rates, but also from their choosing to accept fewer discounted customers -- in favor of other types, including corporate travelers," Adler explained.

Coopers Lybrand's findings on the Manhattan lodging market are available in The Coopers Lybrand L.L.P. Lodging Industry Index Manhattan Report, produced each quarter by a New York-based team of Coopers Lybrand lodging industry consultants and analysts. Across the United States, Coopers Lybrand has hospitality and gaming industry consultants whose client services include market and financial analyses, appraisals, valuations, business planning, litigation support, restructuring and bankruptcy consulting, operational and profit improvement studies, strategic planning and industry research.

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 16,000 professionals and staff located in 100 U.S. cities and, through the global network of Coopers Lybrand International, more than 74,000 people in 142 countries worldwide.

If you would like to learn more about Coopers Lybrand L.L.P., our Internet address is: http://www.colybrand.com.