NEW YORK—Strong supply growth of 6.7% propelled extended-stay hotel occupancy to decline to 70% with a RevPar loss of 1.5% compared to 2007, according to The Highland Group Hotel Investment Advisors, Inc. Extended-stay hotel demand was down 0.4% in the fourth quarter of 2008 but increased 1.2% for the year and maintained the trend of increasing every year since 1990, it reported. Construction starts decreased significantly but supply growth is likely to exceed the change in demand in 2009, noted The Highland Group, adding occupancy will decline and put pressure on average rates during the foreseeable future. The information is detailed in the Groups 2009 U.S. Extended-Stay Lodging Market report.
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