The lack of Hub conventions in June led to lower hotel occupancy and room rates, according to a new survey.
Thomas Grillo
Real Estate Editor- Boston Business Journal
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Greater Boston’s convention business fell in June triggering a drop in operating results at the region’s hotels, according to the latest PKF Consulting survey.
The 93 hotel operators in the PKF Trends in the Hotel Industry sample achieved an average 86.3 percent occupancy at a $207.16 average daily rate (ADR) with a resulting $178.74 revenue per available room (RevPAR). These performance levels represented a 2 percent decrease in occupancy, a 0.2 percent drop in ADR, and an overall 2.2 percent slip in RevPAR for June compared to June 2012.
In June, the six submarkets including Back Bay, Downtown, Cambridge, Route 128, Route 495 North, and Route 495 South suffered from occupancy losses ranging from 1.1 percent in Cambridge to 7.7 percent in the Route 495 North.
Total room nights associated with conventions dropped by half in June compared to a year ago. As a result, hotels struggled to fill rooms with group and transient business in shorter booking windows, the survey found.
Conversely, the three Boston suburban submarkets all experienced ADR gains of at least 2 percent. The ADR of the three Boston core submarkets either remained flat as seen in the Downtown or decreased as experienced by the Back Bay and Cambridge hotels. The resulting RevPAR figures for five submarkets dropped in June. Only Route 128 achieved a RevPAR increase of 2.6 percent because a smaller drop in occupancy was offset by a larger gain in ADR.
Compared to previous Junes since 2005, June 2013 performance for Greater Boston hotels was higher in occupancy than 2008 through 2010, higher in ADR than 2008 through 2011, and higher in RevPAR than 2008 through 2011. The best June for the greater Boston area hotels over the last eight years, based on our Monthly Trends sample, was 2007 with a RevPAR of $191.49.
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