After lagging behind the hotel recovery in the rest of the nation, Greater Hartford hotels are coming back in 2011.
Industry analyst PKF Consulting USA has revised its outlook for the rest of the year and the firm’s latest prediction is rosier than the already glowing report Greater Hartford received early this year.
PKF predicts revenue per available room, or RevPAR, will increase in the Hartford area by 9.1 percent over 2010. RevPAR is an industry metric created by combining the average daily rate, the number of available room and the occupancy rate.
The 9.1 percent increase is a significant jump from PKF’s report in March, which predicted a 6.7 percent increase over 2010.
“Hartford is a bit of a challenging market. The recovery has been suppressed, and it is lower priced than other markets in the region,” said Andrea Foster, PKF vice president and director of hospitality services New England. “We are seeing some pretty good recovery in the market.”
The uptick in RevPAR comes mostly from a rise in occupancy for the 12,975 rooms in the region, hitting 56.9 percent in 2011 compared to 52.9 percent last year. The average daily rate will increase a modest amount to $94.94 compared to $93.53.
The revised prediction puts Greater Hartford ahead of the national RevPAR increase, which PKF predicts at 6.9 percent. The region lagged behind the national hotel recovery in 2010, so this year’s increase will help Greater Hartford catch up.
Based on the long-term, though, Hartford hoteliers will have to get used to a new normal in how busy their hotels will be.
Over the past 12 years, which includes the heyday of the insurance industry bringing visitors into the market, Greater Hartford hotel occupancy averaged 61.2 percent, Foster said. After the market recovers from the recession, the new normal occupancy will be somewhere in the high 50s.
Upper priced brands such as the Marriott are doing much better than the lowered priced brands such as Holiday Inn Express. PKF predicts occupancy at the upper priced brands to be 60.2 percent compared to lower priced brands at 46.9 percent.
That gap will remain between the hotels, even as occupancy begins to climb, Foster said.
