An Updated 2020 Hotels Outlook

Mar 24, 2020, 13:39 PM by Jamie Lane

Economic conditions are deteriorating quickly with the Covid-19 outbreak causing a sharp drop in economic activity. Hotels are experiencing a significant contraction to demand. Our current expectations are that as early as Q3 2020, activity will begin to stabilize, and a recovery is expected to be underway by Q4.

CBRE Hotels Research has released a preliminary 2020 forecast that analyzes the impact of the pandemic on hotel performance and provides insight as to how hotels may start to recover in the back half of the year.

Key Findings:

  • CBRE expects GDP growth will slow to 0.4% in 2020.
  • U.S. RevPAR will decline by 37% in 2020, with a contraction of more than 60% in Q2.
  • Demand will decline by 28% in 2020; ADRs are expected to decline 11% in 2020.
  • The most complex constraint impairing travel comes from social distancing efforts and travel or group gathering restrictions on global populations.
  • Properties that primarily cater to discretionary travel will be affected most, i.e. luxury, upper upscale, urban, airport, and resort properties.

CLICK HERE  to view the full report. 

Deconstructing CRE

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