Hotel Forecast & Amtrak Improvements

Hotels

Hotel Outlook Brightens for Next Year, but Rate Expected to Decrease
The hotel forecasting firm Smith Travel Research says that next year will be better for the hotel industry, but that the industry will continue to see decreases in key metrics.

Of most interest to travelers: the average daily rate, which is expected to decline 3.4 percent to $93.16. Occupancy is also project to drop, but only slightly, by .6 percent. and RevPAR (revenue per available room) is expected to drop 4 percent to $51.29. (Source: Smith Travel Research).

Hotel Rates in Major U.S. Markets Continue to Drop
Average daily rates for hotels in the top 25 markets continue to decline, with the exception of Norfolk/Virginia Beach. The Twin Cities reported the largest ADR drop, 23 percent, to $92.15, in September, the latest month for which data is available.

New York followed with a 23 percent decline to $249. Some markets did see occupancy increases in September: Anaheim-Santa Ana, 3.4 percent to 61 percent occupancy; New York, 1 percent to 85 percent occupancy, and Tampa-St. Petersburg, 1 percent to 43.9 percent. (Source: Smith Travel Research).

Car and Rail

Amtrak Accelerates Improvements
Amtrak, using $25 million in funding from the American Recovery and Reinvestment Act, is replacing pre-World Word II electrical equipment on the Northeast Corridor.

Amtrak began to upgrade 82 outdated substations in 2002; the ARRA funding means that work that was scheduled to start in 2013 is starting now. Transformers that are as old as 75 years are being replaced with more efficient models that have less environmental impact. (Source: Amtrak press release)

The National Business Travel Association's 2010 U.S. Business Travel Forecast predicts that air and car rental costs will be flat and hotel rates will decline between two and eight percent, so businesses will travel more.

• Nearly 7 in 10 of travel managers responding to an NBTA survey expect travel spending to increase
• Fifty-six percent expect their total travel spending to increase next year, 31 percent expect it to stay flat
• Compared to the previous year, many expect to see far fewer spending cuts for conference and event travel

In this new environment, corporate travel managers expect good values from their travel suppliers. Seventy percent of buyers expect to negotiate better hotel discounts next year. More than 30 percent forecast better discounts from airlines. (Source: NBTA press release)