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Canadian Hotel Occupancy Down 65 Per Cent

HENDERSONVILLE, Tenn. — Showing further COVID-19 impact, the Canadian hotel industry recorded negative year-over-year results in the three key performance metrics during the week of March 15 to 21, 2020, according to data from STR.

In a year-over-year comparison, the industry reported a 65-per-cent drop in occupancy to 21.4 per cent, a 16.9-per-cent decrease in Average Daily Rate (ADR) to $120.82 and a 70.9-per-cent decrease in Revenue Per Available Room (RevPAR) to $25.84.

Quebec experienced the largest decline in occupancy and RevPAR, falling 75.5 per cent drop (to 15 per cent) and 77.8 per cent (to $19.94) respectively. P.E.I. recorded the steepest drop in ADR, which fell 24.3 per cent to $87.39.

Ontario saw double-digit declines across all three performance metrics, with occupancy down 65.1 per cent (to 21.7 per cent), ADR down 18.1 per cent and RevPAR down 71.4 per cent.

In STR’s webinar discussing the results for this week, Jan Freitag, STR’s SVP of Lodging Insights, indicated the U.S. experienced the steepest single week decline in RevPAR the company has ever recorded, falling 69.5 per cent in year-over-year comparison. U.S. group occupancy for the week was essentially nonexistent at one per cent, reflecting a lack of corporate demand and halting of meetings and conferences.

“Unfortunately, we fully expect that this data will get even worse next week as travel into the U.S. and North America overall dwindles even further,” Freitag added.

Looking at the major Canadian markets, RevPAR in all of these cities fell more than 70 per cent for the week, including in Ottawa (down 76.8 per cent), which had seen minimal declines for the week ending March 14. Montreal recorded the steepest drop in RevPAR (down 77.3 per cent to $21.67), due to the largest decrease in occupancy (falling 75.6 per cent to 15.3 per cent). Ottawa registered the largest decline in ADR, which fell 20.6 per cent to $129.49.

“Absolute levels of occupancy are, of course, stunning,” said Freitag. “Less than one-in-five rooms is occupied and that is, unfortunately, the new normal that we’re dealing with.”

Looking at performance by hotel tier, luxury and upper-upscale hotels continued to be the hardest hit. RevPAR for the week fell 83 per cent within Canada’s luxury class hotels and 82.4 per cent for the upper-upscale market. Occupancy for these segments was also dismal at 10.4 per cent and 12 per cent respectively.

While data shows midscale as the least impacted segment, it still saw significant RevPAR declines for the week, falling 56 per cent, as well as occupancy of only 25.8 per cent.

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