The U.S. hotel industry will continue to struggle during the first half of 2021 because of the recent surge in Covid-19 cases, but recovery will pick up in the second half of the year with a vaccine now available and wider distribution to come, according to CBRE Hotels Research’s latest U.S. lodging forecast.
CBRE anticipates U.S. hotel occupancy of 44.4 percent in the first half of 2021, increasing to 55.7 percent during the second half of the year. A full recovery to 2019 levels in the three key performance indicators is not expected until 2024.
“The confidence provided by an effective vaccine will serve to sustain the relatively strong leisure travel patterns observed during the summer of 2020, plus initiate a significant return of corporate travelers during the second half of 2021,” said CBRE Hotels Research senior hotel economist Bram Gallagher. “Group demand, on the other hand, will lag in recovery because of the advance-booking nature of this segment.”
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Demand for luxury and upper-upscale properties, which are most dependent on corporate travel and conventions, in 2020 will decline in excess of 60 percent year over year, according to CBRE. Conversely, hotels operating in the economy and midscale segments will see business fall off by less than 25 percent.