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The San Antonio lodging industry attracted more revenue than projected in the third quarter but is facing five straight years of subpar occupancy rates because of a large influx of hotel rooms in the area, according to a new forecast from Houston-based PKF Consulting Corp.
The consulting firm is advising the industry to prepare for a slow recovery and a “new normal” of lower rates, shorter stays and increased competition.
The recovery will be hindered by hotel construction projects that were financed before the recession began in December 2007 but are just now reaching completion.
Nearly 8,000 new hotel rooms are being added in the 2008-2010 period, including the 1,002-room JW Marriott San Antonio Hill Country Resort & Spa, due to open in January. The increase takes the number of San Antonio hotel rooms above 39,000.
Occupancy rates will begin to improve nationally during the second quarter 2010, but the turnaround in San Antonio will occur a year later because of the large influx of new rooms.
San Antonio's hospitality industry fared better during third quarter 2009 than Dallas-Fort Worth, Houston and Austin in terms of revenue per available room, although the numbers were still negative.
The average room rate across the San Antonio market will finish 2009 at $100, down from $110.19 in 2008. The average room rate will drop next year to $99, according to PKF.
[San Antonio Express-News]
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