Manhattan Lodging Index: Q1 2019

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Revenue per available room (“RevPAR”) fell to the lowest first quarter average since 2011, as average daily room rate (“ADR”) declined across all Manhattan submarkets.

During the quarter, increases in lodging supply, which continued to outpace growth in demand, resulted in the largest year-over-year decline in occupancy since 2009. Despite more positive expectations coming into the New Year, the quarter ended on a weak finish with March RevPAR down 11.1 percent. 

With a 7.7 percent decrease from prior-year levels, first quarter RevPAR was driven by a combined decline in ADR and occupancies. With what should have been a favorable calendar shift of the Easter holiday to April this year, March 2019 results were particularly disappointing. Falling by 3.6 percent from prior-year levels, Q1 occupancy finished the quarter at 78.2 percent, compared to 81.2 percent in the first quarter of 2018.

Across all Manhattan hotel classes, Luxury properties exhibited the most notable decline in RevPAR for the quarter. Decreasing by 10.2 percent over Q1 2018 levels, Luxury RevPAR was largely driven by a decline in occupancy of 7.7 percent. For Upper Upscale and Upscale hotel properties, where occupancy fell 2.6 percent and 2.1 percent, respectively, first quarter RevPAR was also impaired by decreases in ADR of 4.6 percent and 3.6 percent, respectively. In Q1, Upper Midscale properties posted the smallest decline in RevPAR of all Manhattan hotel classes, with occupancy and ADR falling by 2.5 and 2.3 percent, respectively.

Manhattan Q1 RevPAR Growth by Month

Source: PwC, based on STR data

About PwC’s Manhattan lodging index

PwC’s Manhattan lodging index provides updates on Manhattan’s lodging market, widely used by lodging brands, developers, and owners. The publication includes:

  • A recap of the operating performance of hotels and sub-market trends
  • Discussion of the overall drivers of operating performance
  • The transactions environment
  • The supply pipeline

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Scott Berman

US Hospitality & Leisure Practice Leader, PwC US

Warren Marr

US Hospitality & Leisure Managing Director, PwC US

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