News Southeast Lodging Continues Strong; Many Rentals Still in Some Flux as Hurricane Recovery Still Impacting Inventory

BRADENTON, Fla., Feb. 26, 2019— Lodging properties in five southeastern states continue to show impressive year-over-year growth in occupancy and revenues while post-hurricane recovery continues to have an impact on available inventory in some regions. Changes in events calendars are also shifting figures from month to month. In the most recent DestiMetrics* Market Briefing released by Inntopia, a strong booking pace in the month of January drove increased occupancy for the single month of January and for the full winter season from September through February.

As of Jan. 31, actual aggregated occupancy for the month of January soared 27.5 percent higher than last year in a year-over-year (YOY) comparison. And even though the Average Daily Rate (ADR) slipped a slight 0.7 percent during the month, the surge in occupancy delivered at 26.5 percent gain in revenue for the month. Nine Southeast tourist destinations in Florida, Alabama, Georgia, South Carolina, and Virginia contribute to the monthly data round-up and are included in the aggregated data.

“For the past few years, we’ve seen a steady growth curve throughout the Southeast when it comes to the leisure traveler,” explained Tom Foley, senior vice president for Business Operations and Analytics for Inntopia. “Although hurricanes and the follow-up recovery process can pose challenges for the affected areas, that consistent growth pattern is holding steady and we anticipate that this winter, with just one month to go, will end with positive aggregated figures for occupancy and revenues among our participating properties.”

With five of the six winter months already “banked” and just February remaining to finish the season, the final winter tally is on track for another strong winter. As of Jan. 31, occupancy is up 17.5 percent in a YOY comparison to last winter and is showing gains in all six months. Aggregated ADR edged up a scant 0.3 percent for the same period but with the jump in occupancy, revenues are up 17.9 percent for the season compared to last year at this time. The upward trajectory was supported by a strong booking pace during the month of January that was up 27.9 percent for arrivals in January through June.

This month’s Briefing noted several caveats for the exceptionally strong pacing. Storm recovery workers, non-governmental agency (NGO) employees, and displaced homeowners were expected to vacate rental properties during January but due to various circumstances, extended their stays. Those extensions created a higher level of occupancy in some regions, drove much of the January booking pace gains, and contributed to a decrease in availability for shorter-term visitors. Additional inventory declines due to hurricane damage still remain a factor although that is diminishing. The report also noted that there were several shifts in event calendars for the period. A change in school breaks moved some vacation times, but a more notable change came with the switch in dates for significant annual military exercises that are typically held in March. This year they were held in January, leading to some challenges in making true year-over-year comparisons.

Economic indicators are also tracked to help anticipate consumer travel behavior. Market volatility diminished in January compared to the roller coaster ride that market indexes rode during December. The Dow Jones Industrial Average (DJIA) reclaimed much of December’s losses despite several notable swings, to close on Jan. 31 a dramatic 7.8 percent higher than December. The Consumer Confidence Index (CCI) declined for the third consecutive month to finish 6.4 points below December. More notably, this is the CCI’s lowest point since July 2017 and is a notable 12.8 percent below last October. Employers added 302,000 new jobs during January and far exceeded analyst’s predictions although December’s job creation numbers were corrected down from the initial report of 312,000 down to 222,000. Wages for employers remained steady during January and gained 3.2 percent over the past 12 months.

“Surprisingly, the government shutdown seems to have had little impact on overall investment, and much of January’s financial market recovery was driven by very strong employment numbers and a slight easing of trade concerns,” continued Foley. “That said, even though consumers’ feelings about current conditions remained about the same as last month, their future expectations declined sharply as the whipsaw activity of the markets combined with the government shutdown impacted them directly. However, government shutdowns have historically had a sharp but short-lived impact on confidence and expectations are that there will be more stability next month,” he added.

Despite some hurdles due to hurricane damage and some lingering impacts, Foley is upbeat about the winter for the Southeast region. “With a stable, but occasionally wayward consumer economy, expectations are that the winter will finish  positively, and that momentum should carry us into the early part of the upcoming high season,” he concluded.

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*DestiMetrics, part of the Business Intelligence platform for Stowe-based Inntopia, tracks resort performance in selected mountain and southeast U.S. destinations. They compile forward-looking reservation data each month and provide individualized and aggregated results to subscribers at participating resorts.

Data from the Southeast is derived from nine resort destinations in five states including South Carolina, Virginia, Georgia, Florida, and Alabama.