U.S. hotel revenue drops 16 percent in November
By Jeannine DeFoe
Bloomberg News Service
HENDERSONVILLE, Tenn. U.S. hotel-room revenue fell 16 percent in November from a year earlier, as the after-effects of the September attacks and a recession kept people from traveling, Smith Travel Research said.
Luxury hotels, including Marriotts and Hiltons in cities such as New York and San Francisco that depend on visitors from air travel, suffered the most.
Revenue per available room, a measure of demand based on average occupancy and room rate, fell 32 percent in New York and 38 percent in San Francisco, according to Smith Travel, which tracks the lodging industry.
With corporations cutting travel budgets and some vacationers reluctant to fly, demand for hotel rooms in the United States won't rise until 2003, Pricewaterhouse Coopers' Hospitality & Leisure Group said earlier this month.
Moody's Investors Service downgraded the debt of Marriott International Inc. and Hilton Hotels Corp. this month, citing falling demand for hotel rooms.
"There's still little business travel," said Harry Curtis, an analyst with Robertson Stephens. He predicted "mid- to high- teens overall declines" in room revenue for December.
Corporations may need to send employees on trips beginning in the first half of next year, Curtis said. "Salesmen will re-establish relations with their customers, many of whom they haven't seen for two quarters."