Report: U.S. GOPPAR Declines for First Time in 2019

NATIONAL REPORT—It was a good run, but it couldn’t last. April was the first month of the year to see a year-over-year decline in profit per room at hotels in the U.S., as a drop across all revenue centers was impacted by rising costs, according to the latest data tracking full-service hotels from HotStats. Gross operating profit per available room (GOPPAR) fell by 3.7% year-over-year to $118.51. Still, year-to-date profit per room is positive at 1.6% year-over-year.

The month’s fall was led by a decline in RevPAR, which dropped by 1.6% YOY to $179.24, as decreases were suffered in both room occupancy (down 0.6 percentage points) and achieved average room rate (down 0.9%).

This marked the first time hotels in the U.S. recorded a monthly YOY decline in achieved average room rate since September 2017.

Further YOY declines were recorded in food & beverage (down 1.3%) and conference & banqueting (down 2.1%) revenue, on a per-available-room basis.

In line with the decline in rate, a 0.6% YOY decrease in TRevPAR to $289.64 signaled the end of a successful run of growth in this measure, which has fallen only once since September 2017.

Payroll levels increased by 3.2% YOY to $95.17 on a per-available-room basis—equivalent to 32.9% of total revenue.

A Look at Miami 

Miami had pronounced difficulty, with GOPPAR off 14.2% YOY in April, a likely byproduct of additional room supply that hit the area. Close to 2,500 rooms have opened in Miami-Dade County in the last 12 months.

As a result, room occupancy in the month plunged by 6.3 percentage points to 79.7%, which contributed to a 14.3% decrease in ancillary revenues.

The drop in profit came in spite of a 4.3% saving in payroll to $69.10 on a per-available-room basis.

A Look at Dallas

Hotels in Dallas provided a bright spot in a generally sour month of performance across the U.S., recording a 1.1% increase in GOPPAR in April to $88.14.

This was the city’s third consecutive month of GOPPAR growth and came despite a 1% decline in RevPAR, which was primarily due to a 1.4-percentage-point decrease in room occupancy.

The growth in profit was also against a 7% increase in payroll levels on a per-available-room basis to $59.62.