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Hotel Performance in Drive-To Destinations Expected to Recover Earlier
The early innings of the lodging sector’s recovery this year will skew toward properties in drive-to destinations, says CBRE. Additionally, properties in rural areas and/or along Interstates have outperformed other location types since the pandemic began, and are expected to return to pre-pandemic levels sooner.
CBRE cites Jacksonville, Virginia Beach and Inland Empire as the markets with the brightest near-term outlook. All three offer “significant drive-to destination appeal and natural social-distancing leisure appeal as beach locations,” says CBRE. “More generally, secondary markets with less urban density and more drive-to availability will recover faster in 2021 than larger metropolitan areas.”
Similarly, rural properties tended to record modest gains in occupancy and ADR after initial fears of the pandemic peaked last April. Recovery to pre-COVID performance should occur sooner in these locations,” according to CBRE. “High-density and urban locations will take longer to recover until the public feels safe to travel to these populous locations.”
By 2022 and 2023, RevPAR recovery will be more even among markets and more in line with long-term trends, CBRE says. By 2023, only the most severely affected markets will have reached less than 90% of 2019 RevPAR levels.
“In addition, some smaller markets such as Jacksonville, St. Petersburg and Savannah may gain additional demand as alternative destinations,” says CBRE.
Pictured: Jacksonville, FL.
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- ◦Economy
