. STR Slightly Upgrades Forecast for 2020 | Northstar Meetings Group

STR Slightly Upgrades Forecast for 2020

A RevPAR recovery still isn't expected until 2024.

Upgraded Hotel Forecast Outlook

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Better-than-expected leisure demand for hotel rooms this fall has led to a slightly better outlook for 2020 U.S. hotel performance, according to the latest forecast from STR and Tourism Economics. The prognosticators released their final forecast update for 2020 in conjunction with the virtual NYU Hospitality Conference.

The forecast for 2021 remains largely unchanged, however, particularly for group business. Full recovery for revenue per available rooms still isn't expected until 2024.

"Even with the encouraging vaccine news of this week, this pandemic and the subsequent economic impact will continue to limit hotel demand generators into the second half of next year," said Amanda Hite, president of STR. "Business demand won't return at a substantial level until caseloads are better contained, and in the meantime, recovery is going to be primarily driven by lower-tier hotels in the leisure-driven markets with outdoor offerings." 

Demand for travel and lodging is unlikely to grow in any substantial way until the pandemic is better contained. "The economy has entered a slower stage of recovery, and Covid-19 will continue to shape travel conditions in coming quarters," said Adam Sacks, president of Tourism Economics. "Assuming substantial progress is made against the virus in the first half of 2021, we anticipate travel demand will rebound strongly in the second half."

STR Tourism Economics US Hotel Forecast 2020



The latest forecast calls for the U.S. lodging industry to recapture 80 percent of previous demand by the end of 2021, with RevPAR lagging, at 34.2 percent less than it was in 2019. The slower recovery of average daily rate and revenue that's anticipated would mean full demand recovery could occur at the end of 2023, with pre-pandemic RevPAR levels occurring by the end of 2024.

According to STR and Tourism Economics, the travel industry remains in the initial phase of recovery, which began this past summer with domestic leisure travel — by both car and by plane — beginning to pick up. The secondary phases of recovery, which will include essential meetings, small and medium events, and regional international travel, are expected to begin in the second quarter of 2021. The forecast calls for the final phase, which will include large events and long-haul travel, to begin in the third quarter of next year.