Providence hotels healthiest they’ve been in a number of years

PROVIDENCE HOTELS HAVE ENJOYED increasing room rates through August compared with previous years, according to research by hospitality data tracker STR, thanks to high occupancy rates. / COURTESY STR
PROVIDENCE HOTELS HAVE ENJOYED increasing room rates through August compared with previous years, according to research by hospitality data tracker STR, thanks to high occupancy rates. / COURTESY STR

PROVIDENCE – The city’s lodging industry is the strongest it has been in the last few years, Jan D. Freitag of STR told invited industry representatives and students at Johnson & Wales University Tuesday.

Freitag, who is senior vice president for Hendersonville, Tenn.-based STR, discussed how Providence compares with national trends. Through August 2015, the city’s trajectory exceeded a steady national trend in improved occupancy, average daily rate and RevPAR, or revenue per available room, he said.

“We have very strong performance from both an occupancy and rate standpoint, and with growth rates that are above the national average,” Freitag explained. “We would expect that room rate growth is going to continue to be healthy for the foreseeable future.”

Weekend occupancy has risen to 82.2 percent in Providence through August, the highest in the past five years, Freitag said. That means hotels sold eight out of 10 rooms every Friday and Saturday for eight months running, on average, he said.

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“It’s a very healthy market,” Freitag said. “The occupancy on the weekend is going to be very hard to grow because at 82 percent that means the city is essentially sold out, so if any growth happens it will happen in the weekday occupancy.”

Heather R. Singleton, chief operating officer at the Rhode Island Hospitality Association, said most of this information had been presented by Pinnacle Advisory Group of Boston at the association’s annual meeting on Sept. 9, but Tuesday, STR broke down the data for JWU students and invited guests.

“What’s exciting for us is, what Jan said today was, ‘Right now, we are either good or awesome, depending on which market you’re in. And in the Providence market, we’re awesome.’ So how could not be happy with that?” Singleton said.

The data also shows that while room supply increased 1 percent across the country, it increased one-tenth of 1 percent in Rhode Island’s capital city. At the same time, room demand rose 4.7 percent in Providence versus 2.8 percent across the country. With the pent-up demand, that means other indicators climbed higher in Providence compared with the rest of the country.

At $157, ADR in Providence was $37 higher than the national average, for a year-to-date increase of 7.9 percent as opposed to the national average of 4.8 percent. RevPAR was $112, an increase of 12.8 percent, compared with the national average of $81 and 6.7 percent.

Occupancy increased 4.5 percent, to 71 percent in the capital city, compared with a 1.8 percent increase to 67 percent across the country, the data shows.

“It’s very good news,” said Terrence L. Strong, director of sales and marketing at the Omni Providence Hotel. “It validates what we’ve been observing here individually at the property. Clearly the city of Providence has benefitted from large events coming into downtown and at the Omni.”

The increased demand come in part from the Volvo Ocean Race in the spring, the North American Irish Dance championship in July and in October, the American Biological Safety Association, Strong said.

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