there were 47,135 properties in the lodging industry, amounting to 4,389,443 guestrooms
Based on statistics from the American Hotel and Lodging Industry, in
2006 sales were in extent of
The revenue per available room totaled
The average occupancy rate in 2007 was 63.3 percent (www.ahla.com).
2006, the lodging industry generated $26.6 billion in pretax profits.
revenue increased in 2006 to $133.4 billion up from $122.7 billion in 2005 (Smith Travel
Based on research from D.K. Shifflet & Associates, we are able to look at
the profile of a typical lodging customer.
44% of customers were traveling for
business while 56% were traveling for leisure.
The typical business room night is
generated by a male (65%), age 35-54 (50%), employed in a professional or managerial
position (44%), earning an average yearly household income of $85,900.
travel alone (56%), make reservations (90%), and pay $112 per room night.
The typical leisure room night is generated by two adults (42%), ages 35-54
(41%), earning an average yearly household income of $77,100.
The typical leisure
traveler also travels by automobile (77%), makes reservations (86%),
and pays $103 per
For a hotel stay, 35% of all business travelers spend one night, 25% spent two
nights, and 39% spent three or more nights.
Of leisure travelers, 42% spend one night,
30% spend two nights, and 28% spend three or more nights (www.ahla.com).
Between 1991 and 2000, the number of brands has grown from 140 to 188 which
is a 34% increase (Price Waterhouse Coopers, 2001).
Some recent studies also suggest
that the level of competition could increase even further making it harder for firms to
grow and cultivate their problems.
It is predicted that the average hotel firm would
continue to increase in size through a combination of new product development (I.e.
extended stay, assisted living, time shares), mergers/acquisitions, and international
expansion (Singh 1999).
“The constant growth in the U.S. market is expected due to the
stable economy which is enjoying a rare mix of low inflation, low employment, and
Despite the fears of over development and another downturn for the lodging
industry, almost all prognosticators are projecting hotel profitability to continue to grow
in the market.
The continued productivity gains, constant demand growth, and moderate
supply growth will dramatically strengthen the industry’s profitability ( Keith Su).”
While in previous years sales growth has increased, currently, hotel revenue per
available room and average daily rate growth will flatten in 2008.
buyers should expect another few years of a hotel seller’s market (PriceWaterCoopers,