The outlook for U.S. hotels at the end of 2020 is slightly better than previously thought, but the industry isn’t likely to return to pre-pandemic levels for years, according to data recently released at the NYU International Hospitality Industry Investment Conference.
Data analysts STR and Tourism Economics suggest U.S. hotel occupancy will close the year with an average of 42.2%, or 2.5% higher than the agencies’ last prediction, made in August. The upgrade came courtesy of stronger-than-expected performances by hotels in the fall.
However, the forecast for 2021 remains unchanged. STR predicts hotels will capture 80% of pre-pandemic demand by the end of next year, and full recovery is not expected until 2024.
“Even with the encouraging vaccine news of this week, this pandemic and the subsequent economic impact will continue to limit hotel demand generators into the second half of next year,” said STR president Amanda Hite.
Orlando hotel performance remains below the national average. Occupancy in Orlando area hotels was 31.9% for the week ending Nov. 7, according to STR.
Loss of demand has hit tourism-heavy Orlando especially hard. Thousands of people have been laid off or indefinitely furloughed from hotels. As of Oct. 14, the Orange County Convention Center had canceled or rescheduled more than 90 conferences and events, estimating the economic impact to the region to be $1.8 billion.
In STR’s recovery timeline, essential meeting travel and regional events could begin to return next year, with international events starting to come back in the third quarter. But the rebound is based on “[a]ssuming substantial progress is made against the virus in the first half of 2021,” according to Tourism Economics president Adam Sacks.
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