Hotel Room Occupancy to Drop as Inventory Expands

Atlanta -- Meeting planners should see slightly more hotel availability in a majority of major U.S. cities next year as increased room supply outpaces demand, PKF Consulting predicted in a report released today.

The hospitality advisory firm forecast that room inventory will grow 2 percent next year over this year while demand increases 1.4 percent, resulting in a .6-percent occupancy decline, to 68 percent. For full-service hotels in major markets, PKF expects occupancy to decrease from 69.4 percent to 68.6 percent.

The slight occupancy decline will still leave planners, especially those with short booking windows, scrambling for rooms during high-demand times in major business centers. In fact, PKF predicts that hotels in 24 of 52 major U.S. markets will probably enjoy occupancy increases despite the national decrease.

"Travelers should still expect to face capacity situations in most cities," said R. Mark Woodworth, president of PKF Hospitality Research, which developed the forecast based on historical data obtained from Smith Travel Research.

Woodworth noted that the 68-percent average annual occupancy has been topped only five times in the past 18 years; annual occupancy long term averages 66.4 percent.

Hotels in regions most heavily impacted by hurricanes are likely to experience the greatest occupancy declines, according to Woodworth. Occupancy in Miami, for example, is forecast to decline 12.2 percent.