I'm heartened to see some evidence that the meetings business is picking up among some hoteliers, yet there's still some time for aggressive sourcing for bargains. Starwood Hotels & Resorts earlier this month said that it is seeing higher weekday occupancies and revenue per available room -- partly due to more business bookings and "pent-up" demand for meetings and conventions bookings, according to a
story in The Beat.
Starwood CFO Vasant Prabhu said RevPar rebounded at company-operated hotels (from a 12% drop in November to a 3% slip in January). The pace of the improvement was driven by growing occupancies in transient travel, but the company also indicated that booked group events next year are higher than for 2010.
The Beat quoted Prabhu as saying, "lead volume" in the fourth quarter jumped 15% --"the first increase since the financial crisis broke." Meanwhile, cancellations declined by 50%. And December group bookings for the first half of 2010 "were up over 100 percent."
This is indeed good news for Starwood and the industry at large, and, if you're wondering if it's going to immediately push up rates, you can relax. There's still a window of opportunity open for buyers. Even though Starwood said that the growth in occupancy emboldens it to think more aggressively about rates going forward, the company expects that an upward move in average daily rates will lag the recovery, just as a drop off in business didn't immediately follow the economic bust.
Timing is everything sometimes, and it seems like it's time to start sourcing more aggressively and efficiently before bargain lodging opportunities evaporate. No one knows what the future holds, but the signs are pointing to higher demand...and an inevitable rise in rates.
Kevin Iwamoto is vice president of enterprise strategy at StarCite. This post is syndicated from his blog, Strategic Meetings Management