Caribbean Hotel Numbers Flat for 2018’s First Six Months

Hotel performance in the Caribbean through June was relatively flat, due in part to the effects of the 2017 hurricanes and the loss of inventory from properties still closed, according to the Q2 Hospitality Market Update from Integra Realty Resources.

The continued expansion of Airbnb and similar alternatives to conventional hotel stays, as well as an increasing supply of new hotel inventory, also may have been contributing factors.

The report cited data from STR through June, indicating that occupancy in the Caribbean region was down 1.4%, to 69.89% and that the average daily rate had declined 0.4%, to $218.34.

However, room inventory (regardless of closures) grew by 3%, to 251,738 rooms in 1,964 projects as of June, compared to the same period last year.

Going further back, the report found that over the last five years, supply has increased 11.5% while demand has increased 9%.

On a country-by-country basis, the country reporting the highest ADR for the 12 months through June was the Cayman Islands at $426.95, up 17.9%, followed by St. Lucia at $369.03 (down 7.8%) and Aruba ($300.69, up 7.7%).

“It is likely that the ADR for Cayman was buoyed by the opening of the Kimpton Seafire in December 2016 as well as the divergence of tourists that would otherwise be traveling to hurricane-affected areas,” the report said.

Statistics for the U.S. Virgin Islands, which normally reports high ADR numbers, were not included because the majority of hotels that report data to STR were, and still are, closed due to storm damage.

As of June, STR reported 92 projects totaling 21,360 rooms under development in the Caribbean, a 25.8% jump compared with June 2017. The leader in that category was the Dominican Republic, with 6,086 rooms under development, including the 1,020-room Lopesan Costa Bavaro Resort & Spa and the 909-room H10 Punta Cana. Jamaica was second with 3,246 rooms, followed by St. Lucia with close to 1,600 rooms in its pipeline, representing 25% of the total existing room stock in the country.

A projection early this year by the Caribbean Tourism Organization pointed to a 2% to 3% growth in arrivals for 2018 and beyond, reflecting what the report described as a “gradual slowing of growth.”

“All metrics point to a mature market that will require nurturing with respect to creative marketing to maintain growth in hotel performance in keeping with increasing supply,” the report concluded.

Source: www.travelweekly.com

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