Major Hotels Report Marginal Improvement

Print
According to preliminary statistics released by the Bahamas Hotel Association and The Bahamas Ministry of Tourism and Aviation, the 14-major New Providence hotels showed continued improvement in December, with increases in several key metrics.  These improvements helped to counter weather-related impacts last January and in August, September and October, resulting in marginal increases in occupancies, room revenue, average daily room rate (ADR) and revenue per available room (RevPAR) in 2011.

Summary Performance Report for December 2011 and Year-to-date
Major Nassau-Paradise Island Hotels
Report Date:  January 26, 2012

Commenting on the performance, BHA President Stuart Bowe said “We continue to be encouraged by the progress we are seeing.  Although we are still not at pre-recession performance levels, we are clearly headed in the right direction.  With hotels facing increased operating costs and many investing more in capital improvements to ensure our competiveness, it is essential that we increase our revenue.”

Bowe attributed the encouraging results to joint promotional and product improvement efforts by the hotels and the Ministry of Tourism.
 
“We are seeing the value of our strong marketing and promotion initiatives which are resonating well in the marketplace.  These have been underway for two years and each year we have seen incremental progress.  We are also pleased to see some of the highest customer satisfaction levels reported in years, with visitors citing overall improvements in the experience and appearance of our islands.”  he added. 
 
December 2011 saw an occupancy rate of 58.3%, a $3.55 increase in the ADR and a $10.81 increase in RevPAR. The December 2011 ADR was $270.65 compared to $267.10 for December 2010 while the RevPAR was $157.72 compared to $146.91 in 2010. Room nights sold increased by 5.1% and hotel room revenue by 6.5% over December, 2010. There was a 0.8% decrease in available room nights compared to 2010.

The base that December’s performance was built on, however, was narrow with only eight of 14 hotels reporting hotel room revenue increases over December 2010. Of these, five saw their revenue increase generated through higher room nights sold only, two through higher ADR that compensated for a decline in room nights sold and one property as a result of increased ADR and room nights sold.
 
2011 performance showed a 63.9% occupancy rate compared to 62.6% last year. The ADR was $236.26 compared to $231.96 with the room nights sold up 1.3% and room revenue up 3.1%. This primarily reflected a poor first quarter of 2011 when room nights sold, ADR, hotel room revenue and RevPAR all recorded decreases over 2010. While hotel room revenues started their uptick in the second quarter, it wasn’t until the third and fourth quarters that room nights sold for a quarter jumped into positive territory. This was consistent with improved economic indicators in the United States.
 
Looking at the 2011 performance at the property level, half of them (7) recorded hotel room revenue increases for the year, driven primarily by higher room nights sold levels (5 properties). While a similar story could be told of the seven properties with their revenue declines and their lower room nights sold levels, three of these seven properties also had lower ADR’s. Of course, some of this was impacted by the closure of some properties in the second half of 2011 for repair and renovation.
 
However, contrast this with 2010 compared to 2009.  In 2010, nine properties showed hotel room revenue increases over 2009 with six (6) of them achieving this through increases in both ADR and room nights sold.

Comparative figures for 2008 showed a 63.4% occupancy and a $246.70 ADR.  Room nights sold along with room revenue in 2011 were 4.8% and 8.9% below 2008 levels.  ADR in 2011 was some $10 below 2009 hoisting the 2012 ADR therefore offers the best opportunity to regain 2011 revenues, i.e., a repeat of the 2010 improvement in both ADR and room nights sold.

Preliminary air arrivals to Nassau to the end of October were down 3.3%.
 
Bahamas Hotel Association (BHA)

Last Updated on Monday, 30 January 2012 10:45