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Hotels Experience Healthy Growth in Both Bookings and Rate

Hotels Experience Healthy Growth in Both Bookings and Rate

The transient segment, which consists of individual business and leisure travelers, continues to be the driver of significant growth in the hotel market this summer season, according to data from the June 2014 TravelClick North American Hospitality Review (NAHR). However, the transient segment isn’t the only driver as the group segment (blocks of hotel rooms) is displaying slow but steady growth.

“As we get further into the summer, average daily rates (ADR) and occupancy continue to look strong across all travel segments,” said John Hach, senior vice president, global product Management of TravelClick. “Compared to this time last year, the hotel industry is really feeling the benefits of a stronger economy, and there’s a renewed desire for people to take advantage of the summer weather and travel.”

For the next 12 months (June 2014 to May 2015), overall committed occupancy is up 3.2 percent when compared to the same time last year. ADR is up 3.6 percent based on reservations currently on the books.

Transient bookings are up 4.2 percent year-over-year, and ADR for this segment is up 5.1 percent. When broken down further, the transient leisure (discount, qualified, and wholesale) segment is showing occupancy gains of 3.8 percent and ADR gains of 5.9 percent. The transient business (negotiated and retail) segment is up 4.4 percent with an ADR increase of 4.2 percent. Group segment occupancy is ahead by 2.8 percent and ADR is flat (up 0.2 percent), compared to the same time last year.

“Typically the third quarter is very strong for transient leisure travel and weaker for group travel, as people take their vacations during these summer months and are less likely to travel for large meetings and conventions,” Hach continued. “However, the group segment is seeing healthy gains in both ADR and occupancy, signifying the strength of the overall market.”

The June NAHR looks at group sales commitments and individual reservations in the 25 major North American markets for hotel stays that are booked by June 1, 2014 from the period of June 2014 to May 2015.

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