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Sacramento Area Hotels Surpass 70% Occupancy Threshold
for March Coming in at 72.1%

By Mark Glover, The Sacramento Bee, Calif.McClatchy-Tribune Regional News

May 16, 2012--Sacramento-area hotels are seeing more visitors, and the occupancy rate climbed above the key 70 percent threshold in March.

The latest report by the San Francisco office of hotel industry tracker/consultant PKF Consulting USA said the average occupancy rate among area hotels was 72.1 percent in March, up from 68.9 percent in March 2011.

Occupancy rates in January and February this year were 59.1 percent and 67.5 percent, respectively. Historically, January and February are relatively slow months in the Sacramento-area lodging industry.

In the industry, 70 percent occupancy is generally considered the point at which hotels can raise room rates and generate more revenue.

Now, the goal is to either maintain or build on that, especially in the key summer travel months.

"It's still early on in the year, but most likely in the summer months, business will increase," said PKF consultant Ashish Patel. "Coming into the spring, the (regional) market appears coming back. That's evident throughout Northern California."

Even with regional variables, the Sacramento area's occupancy rate in March topped Marin, Napa and Sonoma counties. San Francisco continued its robust pace with a 78.4 occupancy rate in March.

The average daily room rate in the Sacramento area in March was $95.52, up slightly from $94.96 in the year-ago period. Revenue per room in March was $68.87, up from $65.46 last year.

PKF officials noted that the Sacramento area had a building boom of hotels from 2004 to 2010, and the area's occupancy rate is just now catching up to pre-recession expectations.

Mike Testa, senior vice president of sales for the Sacramento Convention and Visitors Bureau, said he has seen interest pick up in Sacramento as a meeting and conference destination for groups of all sizes.

Testa said event organizers are booking facilities and lodgings further in advance of the event date, and attendee numbers are on the upswing.

"We had a situation where we were booking more groups but attendance was not going up," Testa said. "Instead of 1,500, you might have 600 or 700. But now that's changing."

Through the first quarter this year, San Francisco continued to shine as a primary tourist destination, and the numbers reflect the city's high percentage of four- and five-star hotels.

Through three months, San Francisco hotels had an average occupancy rate of 73.9 percent, with an average daily room rate of $197.37 and a revenue per available room average of $145.86.

Call The Bee's Mark Glover, (916) 321-1184.


(c)2012 The Sacramento Bee (Sacramento, Calif.)

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