Leisure hotel rates realized record growth in May, climbing almost +5% according to monthly data released from Pegasus Solutions in The Pegasus View. The corporate market, having suffered a brief booking dip in April, returned to bookings increases of +15% over 2010 in May, accompanied by rate increases of +6.5%…
Leisure hotel rates realized record growth in May, climbing almost +5% according to monthly data released from Pegasus Solutions in The Pegasus View. The corporate market, having suffered a brief booking dip in April, returned to bookings increases of +15% over 2010 in May, accompanied by rate increases of +6.5%.
Forward-looking data in April indicated a strong summer travel season for the leisure market, which was realized with reservations growth of +8.3% over prior year in May. Together, the rate and bookings increases drove a rise in global hotel revenue of +15.0% over prior year, surpassing the year-to-date growth pace of +12.5%.
“Rising leisure rates indicate rising demand, but consumers are keeping budgets in check by shortening trips and seeking out packages for the best value,” said Mike Kistner, chief executive officer of Pegasus Solutions. “Hotels can attract their fair share or more of this demand by offering value through distinctive packages – enticingly priced offerings involving additional nights, premium hotel services and/or local attractions – rather than invoking profit-eroding standard rate discounts.”
Global corporate travel bookings jumped from April’s temporary growth slump to an increase of +15% in May. Average daily rate (ADR) growth for the channel kept to the year-to-date pace of +6.5% over 2010, and is expected to trend strongly through the third quarter. Pegasus’ forward-looking data, based on business on the books, shows corporate bookings ramping back to near +20% growth in the third quarter, with length of stay (LOS) and booking lead times also increasing.
The forecast for the leisure market is equally promising. Data shows steady leisure travel bookings growing at an average pace of +10% over 2010, accompanied by steady and potentially climbing rate growth through summer. Rates for the segment have been increasing for a solid year now, though at less than half of those for business travel.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
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