Sept. 24, 2018— Good weather and a strong economy are being credited with giving participating Southeast destinations a new summer occupancy record—albeit a small one, according to Inntopia in their DestiMetrics* Monthly Market Briefing released last week. As of Aug. 31, participating Southeast destinations in five states were up an aggregated 2.2 percent occupancy over last summer for the months of March through August. This sets a new record for summer occupancy. The Average Daily Rate (ADR) edged up a scant 0.7 percent that along with the boost in occupancy, delivered an aggregated 5.9 percent increase in revenues compared to the same time last year.
The record was secured with strong August figures to finish up the season. Occupancy for the month was up a healthy 4.6 percent compared to last year. Combined with the slight increase in ADR, monthly revenues finished up 2.9 percent compared to August 2017.
“As we close the books on another summer, we can consider this season a winner,” explained Jeremy Dreiling, production manager for the Business Intelligence division of Inntopia. “Posting occupancy increases in five of the six summer months is notable, and to achieve this growth while also moving up rates, was a slow but positive trend that also allowed revenues to increase compared to last summer.”
Additional data about bookings for the coming winter season months (September through February) was also highlighted in the monthly Briefing. As of Aug. 31, on-the-books aggregated occupancy for the winter is up 4.6 percent compared to last year at this time with increases in five of the six months—only December is showing a slight dip—of 1.2 percent. The ADR is up 1.8 percent compared to last winter and when combined with the uptick in occupancy, is delivering a 6.4 percent increase in revenues.
DestiMetrics also tracks key economic indexes each month and summarizes how they could influence and shape discretionary consumer spending—including recreational travel. The Dow Jones Industrial Average (DJIA) moved up another 2.4 percent in August for the fifth increase in the DJIA since the start of 2018 and brought it within 185 points of the all-time high in January. August also marked the longest bull market streak without a major correction in 60 years. Analysts credit strong economic figures and earnings that have piqued the interest of investors.
The Consumer Confidence Index (CCI) gained six points in July, bringing it to 133.4 points, its peak level in 2018 and its highest measurement since October 2000. The recent surge in confidence is being attributed to consumers reacting positively to the re-negotiation of a new trade agreement with Mexico and optimism for a similar agreement with Canada.
“These historically high confidence levels have analysts predicting that consumer spending will continue its healthy upward trend through 2018 and will continue to foster stable economic growth,” Dreiling added.
The Unemployment Rate remained unchanged at 3.9 percent during August despite 201,000 new jobs being added during the month and exceeding analysts’ expectations of 192,000. Nearly a quarter of those new positions were in business and professional services—a sector that pays relatively well. These well-paying jobs nudged hourly earnings up .04 percent over last month and the monthly Briefing reports that these higher wage positions contribute to a larger middle-class with increased discretionary spending ability.
“Even though the winter months are historically the low season in the Southeast, robust on-the-books reservations going into September have laid the foundation for a high performing winter,” continued Dreiling. “However, the havoc wreaked by Hurricane Florence has received extensive media coverage and looking forward, unpredictable situations such as red tide warnings, hurricanes, or any other unanticipated market disruptors could still have an impact on both occupancy and rate in the coming months,” he concluded.
*DestiMetrics, part of the Business Intelligence platform for Stowe-based Inntopia, tracks resort performance in selected mountain and southeast U.S. destinations. They compile forward-looking reservation data each month and provide individualized and aggregated results to subscribers at participating resorts.
Data from the Southeast is derived from nine resort destinations in five states including South Carolina, Virginia, Georgia, Florida, and Alabama.