Slow recovery seen for U.S. hotel industry

(Reuters) – It is a buyer’s market for hotel rooms in the United States, and the situation is not likely to change soon.

Hotel occupancy rates have stabilized, but discounting of room prices remains rampant in many markets, indicating a slow recovery for the industry.

While most participants at a hotel business conference in San Diego this week said the bottom of cycle was near, they also saw no upturn before 2011.

“2009 was awful,” PKF Hospitality Research President Mark Woodworth said in a conference presentation. “We believe that this year will be weak as well. The buyer’s market will persist into next year.”

Demand for both vacation and business travel has fallen sharply since the 2008 onset of the latest recession. In particular, the luxury sector and group travel have suffered as bailed-out banks and others sought to avoid being labeled as frivolous spenders.

U.S. revpar, a measure of occupancy and room revenue that is considered a barometer of lodging industry health, fell nearly 17 percent last year.

PKF expects a decline of 1.1 percent for this year, while Smith Travel Research has forecast a 3.2 percent drop.  For full report from Reuters, please click here….