PWC projects a strong holiday season for hotels

The hotel industry had much to be thankful for over the busy Thanksgiving weekend, and it should expect plenty of cheer during the upcoming holiday season.

Lodging industry specialist PricewaterhouseCoopers estimated that year-over-year hotel occupancy over the Thanksgiving weekend rose 0.7%, to 52.9%. It projects that hotel occupancy between Dec. 25 and Jan. 1 will hit 48.8%, an increase of 1.7%.

PWC estimates that occupancy for the Thanksgiving and holiday seasons will be up 2.6%.

PWC said several factors are fueling the increase in hotel bookings.

Lower gasoline prices, gains in personal income, expectations of favorable year-end bonuses, increased inbound international travel and no events, such as last years hurricanes, that could negatively affect hotel supply and demand are among the factors that will result in a year of record demand for hotels, said Bjorn Hanson, a principal with PWC.

Should PWCs forecast hold, the strong holiday season will cap what has already been a good year for the hotel industry.

PWC is projecting that the national hotel occupancy average for 2006 will hit 64.2%, the highest occupancy level in a decade.

The immediate outlook for hotels is rosy, as well. The firms research indicated that revenue per available room, or RevPAR, for hotels in major gateway cities such as Boston, Chicago, New York and San Francisco was expected to grow 9% next year compared with 4.7% in 2006.

However, growth in occupancy was forecasted to slow a bit. National occupancy was expected to be 64.3% in 2007, a 0.1% increase.

While occupancy growth will slow down, occupancy will remain the highest it has been since 1996.

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