Commercial real estate services firm CBRE has released its most recent analysis of the extended-stay hotel segment, looking at occupancy, ADR, revenues and profits, and the differing performance of upper- and moderate-priced properties, using its annual “Trends in the Hotel Industry” survey 2010-2017 figures.

The main points include:

  • Compound annual growth rates in revenue and operating profits for extended-stay properties between 2010 and 2017 were slightly lower than those achieved across all hotel types, but it was less hard-hit than most parts of the hotel sector in the 2009 recession, meaning growth since then was less marked.
  • Extended-stay is expected to continue to be profitable, especially in light of longer stays leading to lower costs for housekeeping, front desk activity, etc.
  • Moderate-priced extended-stay performed slightly better than upper-priced properties across revenue and occupancy.
  • Upper-priced extended-stay hotels performed better in terms of RevPAR and gross operating profits.

In conclusion, CBRE forecasts demand for US hotels to grow around 2% yearly to the end of 2022, boding well for the extended-stay segment.

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