In 2011, Manhattan occupancy growth was minimal, over 2010 levels, but average daily rates ("ADR") increased, driving a healthy increase in revenue per available room ("RevPAR").
During the fourth quarter of 2011, Manhattan's occupancy levels increased 3.7 percent to 86.6 percent, continuing the trend from the third quarter. With confidence resulting from improved occupancy levels, Manhattan hotels made further strides in regaining pricing power, resulting in a 2.4 percent increase in ADR. This combination led to a 6.1 percent increase in RevPAR in the fourth quarter, compared to year-ago levels.
On an annual basis, occupancy levels grew only 0.2 percent, while ADR levels increased 5.6 percent, driving a healthy 5.7 percent increase in RevPAR. In a sign of the extent to which Manhattan hotels have regained pricing power, ADR contribution to RevPAR growth increased to almost 98 percent in 2011, compared to 2010, when ADR contribution to RevPAR growth averaged approximately 65 percent.