Hotel Profits Improve as Recovery Spreads

Originally published on June 8, 2021, by Michael Tucker on the Mortgage Bankers Association.

STR, Hendersonville, Tenn., said hotels saw an encouraging April as more revenue flowed through to the bottom line.

Gross operating profit for U.S. hotels reached 60 percent of the comparable April 2019 level, said STR Assistant Director of Financial Performance Raquel Ortiz. She noted STR currently benchmarks recovery against comparable periods from 2019 rather than 2020 due to last year’s unnaturally steep pandemic-driven performance declines.

Each STR profitability metric improved to a point higher than any month since February 2020 except for labor costs, which increased compared to March. Gross operating profit per available room reached $28.67 and total revenue per available room increased to $87.34. Total labor costs per available room increased to $26.76 in April.

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