HotStats: U.S. sees positive profits in October

AFTER MONTHS OF losing money during the COVID-19 pandemic, U.S. hotels finally saw positive profits in October, according to HotStats. Whether that trend continues in the face of rising COVID-19 cases remains to be seen.

The gain was also small as U.S. hotels saw GOPPAR for the month at $5.43, down 95.5 percent compared to the same time last year. A slight rise in occupancy and ADR led RevPAR to hit $40.99, down 78 percent from the previous year, but a 7.3 percent rise over September and a 365 percent increase over April, when RevPAR was at its lowest point at $8.99.

TRevPAR hit $60.89 in the month, $5 higher than the month previous but down 79.3 percent year over year. While F&B RevPAR hit double digits for the first time since March, it is still down 87.9 percent from the previous year and may go down in the future.

“As local measures to curb the spread begin to be reimplemented, it could have a negative impact on F&B by reducing the number of covers a restaurant is allowed due to physical distancing rules,” HotStat said. “Up until now, many restaurants were able to endure by offering al fresco dining, but as the warmer weather in the country gives way to colder temperatures, it could blunt the success of that.”

Labor costs, usually the largest expense for hotels, was down 23 percent, possibly because of the end of the summer season. Total labor costs as a percentage of revenue dropped nearly 20 percentage points over September to 47.8 percent as revenue grew and labor cost decreased.

For October, at least, the U.S. joined other global markets in a trend toward positive profits, led by the Asia-Pacific region, where monthly occupancy exceeded 50 percent for the first time and China’s occupancy passed the 60 percent threshold for the past three months. Europe was the outlier this time with a 5 percent drop in occupancy for the month leading to a 20.7 percent decrease in RevPAR and negative GOPPAR of €5.06.