Hotels – Gross operating profit for U.S. hotels made a significant improvement of 70% of the comparable 2019 level, as per STR’s May 2021 monthly P&L data. While demand, revenue and GOP have been on a steady rise, labor spending remained flat from the previous month at 64%.
Each of the key profitability metrics, on a per-available-room-basis, fared higher than any month since February 2020, except for labor. GOPPAR stood at US$37.30, TRevPAR was US$102.52, EBITDA PAR was US$22.54, while LPAR (labor costs) was US$30.96.
“Overall, 95% of hotels broke even on a GOP basis, while 73% broke even on a net income basis. For context, those percentages were 98% and 85% in May 2019, so while the improvement is encouraging, many hotels are still experiencing financial difficulty, and even more are seeing staffing issues as evidenced by the stagnant rate of labor costs,” said Raquel Ortiz, STR’s assistant director of financial performance.
According to the study, properties in the warm regions and beach markets like Miami, Phoenix, Tampa, Los Angeles and San Diego made a better recovery and managed to reach the positive GOPPAR territory.
Among the top 25 markets, Tampa saw the only occupancy increase over 2019 (3.5% to 78.5%), while San Francisco/San Mateo experienced the steepest decline in occupancy when compared to 2019 (-39.3% to 53.4%). Miami reported the largest increase in ADR (48.5% to US$222.95) and RevPAR (44.7% to US$ 163.37). Meanwhile, the largest RevPAR drops were seen in San Francisco/San Mateo (-59.3% to US$84.14) and Boston (-53.9% to US$90.07%).