Manhattan Lodging Index – Q4 2018

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Overview

Revenue per available room (“RevPAR”) reached the highest fourth quarter average since 2006, as growth in average daily room rate (“ADR”) rebounded at Manhattan hotels. During the quarter, lodging supply, which continued to outpace growth in demand, resulted in declines in occupancy. With strong commercial traveler demand during the first half of the quarter, coupled with price-elastic holiday tourism in the latter half, Manhattan room rates finished the quarter at an average of $328 per night.

Manhattan

Representing a 2.8 percent increase from prior year levels, fourth quarter RevPAR was driven entirely by growth in ADR of 3.5 percent. Despite declines in occupancy during the second half of 2018, fourth quarter occupancy of 89.9% contributed to the highest annual occupancy rate for Manhattan hotels over the 24-year period tracked.

Across all Manhattan hotel classes, Upper Midscale properties exhibited the most robust growth in RevPAR for the quarter. Increasing 5.3 percent over Q4 2017 levels, growth in Upper Midscale RevPAR was largely driven by an increase in ADR of 4.6 percent. For Luxury and Upscale hotel properties, where occupancy fell to 84.8 percent and 92.1 percent respectively, fourth quarter RevPAR growth was lifted by increases in ADR of 5.1 percent and 3.8 percent, respectively. In Q4, Upper Upscale properties posted the lowest growth in RevPAR of all Manhattan hotel classes, with occupancy remaining flat and ADR growth averaging 1.3 percent over the prior year.

Manhattan Q4 Performance, 24-Year Trend

Manhattan Q4 Performance Lodging

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

How PwC can help

Contact us

Scott Berman

US Hospitality & Leisure Practice Leader, PwC US

Tel: +1 (305) 375 6210

Warren Marr

US Hospitality & Leisure Managing Director, PwC US

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