US: Commercial real estate investment and services firm CBRE has predicted a late 2022 date for the US hospitality sector’s recovery.
Its research believes that the industry will benefit from a possible quick economic turnaround in 2021.
The group’s recent Hotel Horizons publication has predicted that the steep decline in RevPAR, ADR and occupancy will start to slow as the year passes. Growth will hopefully return by late 2021.
Jamie Lane, Senior Director of CBRE Hotels Research said: “The U.S. lodging sector has been hit by two headwinds in 2020: a contraction in overall economic activity and the need for social distancing. Accordingly, our current forecast calls for a 37 percent reduction in the number of room nights occupied in 2020 compared to 2019.
“There is some comfort knowing that travelers will be back on the road in full force within two years.”
Though the report predicts a return of demand quite early, national ADR will not return until a later point in time. Even by late 2023, fewer than half of CBRE’s profiled markets will return to pre-crisis levels of revenue.
Bram Gallagher, CBRE Senior Economist Said: “Although the trough in 2020 lodging performance will be much deeper than anything we’ve seen in the past 80 years, much of this decline is not caused by underlying fundamental economic problems. Once social gathering restrictions are lifted, an expected return to the strong underlying economic conditions that existed before 2020 will restore economic production.”
CBRE is not alone in its positive forecast for recovery. Research from The Caterer predicts up to £4 billion in hospitality spending in the UK when lockdown is lifted, while additional American insights predict a boom in certain types of vacation.
For more information, see CBRE’s Hotel Horizons here.