A tale of two cycles: 1992 versus 2016

With all the talk of the nature of cycles in hospitality, Hotel News Now has provided some valuable insight in comparing 1992 versus 2016. 

Published by: Jan Freitag/Hotel News Now
Published date: May 2016

No other question has been asked of STR more often than this one. Operators, owners and investors all want to understand how much longer the current up cycle can continue. And while our forecast still calls for positive revenue per available room growth through at least 2017, it is difficult to comment on the end of cycle. (STR is the parent company of Hotel News Now.)

A benefit of having access to data back to 1989 is the ability to compare the current hotel industry cycle to other cycles in the past. Clearly the current period does not compare to the 2007/2008 or 2000/2001 cycles when external events caused a precipitous decline in U.S. room demand followed by a steep fall in average daily rate. Looking further back after the moderate recession of 1990, starting in 1992 could be a better comparison point because RevPAR growth was positive for a period of nine years (until 2001). Because we are in the seventh year of prolonged RevPAR growth, we thought it would be interesting to compare these two cycles.

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