NORFOLK, Va. (WAVY) — Old Dominion University continues to monitor the hotel industry in Virginia and the nation.
On Monday, Jan. 24, ODU’s Dragas Center for Economic Analysis and Policy released the most recent monthly hotel data from STR, a global firm that monitors the hospitality industry.
The data shows that Hampton Roads saw nine percent higher hotel revenues in 2021 compared to 2019. The recovery from the industry’s blow taken during the pandemic outpaces the recovery both in Virginia and nationwide. Hampton Roads’ hotel industry is outperforming the top 25 markets in the country when it comes to metrics such as growth in revenue and revenue per available room.
However, hotel revenues for Virginia are still 18 percent lower than those in 2019. Northern Virginia and Richmond — the two other markets that make up the bulk of the hotel industry in the state in addition to Hampton Roads — are still seeing significantly lower revenue rates for 2021 compared to 2019. Revenue for Northern Virginia in 2021 was still 47 percent lower than 2019, while Richmond was four percent lower.
Hampton Roads has “more than recovered” from the downturn caused by the pandemic.
“The hotel industry in the state still has a long way to go before it fully recovers from the pandemic,” the Dragas Center said in a news release Monday. “… Essentially, the Northern Virginia market, which accounted for 43 percent of the revenue generated in the commonwealth in 2019, is responsible for most of the decline in the state for 2021.”
Rates for rooms in Virginia also decreased in 2021 compared to 2019: the average daily rate for hotel rooms in 2021 was $105, a seven percent decrease from 2019’s rate.
The revenue per available room metric, which experts say is used as an industry standard to gauge the health of the lodging sector, fell to $59 — 18 percent lower than its level in 2019.
Rooms sold decreased in various Virginia markets, except for the Chesapeake and Suffolk market. Rooms decreased by 31.4 percent in Northern Virginia, 8.9 percent in Charlottesville, and 1.4 percent in Hampton. Chesapeake/Suffolk saw an increase in rooms sold by 4.9 percent.
Within Hampton Roads, the Virginia Beach market found some success: revenue increased 21 percent in 2021 over 2019 rates. Williamsburg’s revenue was the only Hampton Roads submarket that saw a decline in revenue.
“The hotel industry continues to recover in the commonwealth and has fully recovered in Hampton Roads,” said Professor Vinod Agarwal of the Dragas Center. “With increasing vaccinations, rising consumer confidence and continued pent-up demand in leisure travel, we have seen significant improvement in the performance of the hotel industry over the 2019 levels, and we expect the industry to continue its recovery in 2022. However, increasing cases of omicron, continuing COVID-19 infections, hospitalizations and deaths among the unvaccinated also threaten to undermine the pace of recovery.”