High hotel occupancy rates: good news for hoteliers poses challenges for buyers
Hotel occupancy rates rose worldwide in 2010 as travel demand improved. As 2011 continues, high
occupancy rates, and the average daily rate (ADR) increases that accompany them, are expected to
persist in many key global business markets. While this certainly presents challenges for travel
programs, if managed well it can also reinforce the value these programs provide organizations,
including the role of travel management in helping business travelers navigate an ever-changing
According to Smith Travel Research, Asia Pacific experienced the highest overall occupancy levels in 2010, with 66% of rooms occupied last year. Hotels in Sydney, Australia, enjoyed the highest occupancies in the world, averaging 84%. As Asia Pacific’s booming economy enables it to lead the travel rebound, high occupancy will continue to be most challenging in the region’s key financial cities. Latin America is also experiencing high overall occupancy rates, averaging 64% across the region. While Europe, the Middle East, and Africa (EMEA) was significantly impacted by the economic downturn and is currently experiencing the slowest economic growth, occupancy rates there have remained relatively stable in the past several years, enabling the region to conclude 2010 with average occupancy rates of 63% thanks to demand in cities like London and Paris. Finally, while economic outlooks in North America are largely positive, it experienced the lowest regional occupancy in 2010, at 58%, indicating continued caution on travel as conditions began to improve during the first part of the year.