The U.S. hotel industry had its most profitable year in history in 2005 according to Smith Travel Research (STR). A record $122.7 billion in revenue and $22.6 billion in profits were posted last year, which is slightly above the $22.5 generated in 2000. The figures are a positive sign that the industry has rebounded from the effects of 9/11 on the travel industry, with nationwide ADR and occupancy incerasing 5.4% and 2.9%, respectively. Although STR speculated that the numbers could have been even higher if not for rising energy, labor and insurance costs, room demand remained high in ‘05 and it was the first year the hotel industry sold over one billion room nights. The increase in demand should lead to even higher occupancy rates this year with around 75,000 new rooms expected to open.
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