Conference Momentum: Corporate Group’s Business Continues to Outpace Other Segments


U.S. hotel performance has been inching toward normalization levels over the past three quarters. While the trend toward normalization is evident across most data segments, group business has received particular attention in recent months.

Despite a slight increase in market supply, group share increased year-on-year in each month of 2023 except December. This increase was mainly due to the corporate sector, with the level of rooms occupied by group blocks (bookings for 10 or more people) increasing by 12% on weekdays (Monday to Wednesday) and 6% on regular days (Sunday and Thursday); It was only 2%. Weekends (Friday to Saturday) are percentages. The weaker weekend growth was due to the absence of pent-up leisure demand (weddings and other social gatherings) that would still be driving the group index in 2022.

Flip the calendar to 2024 and group occupancy increased by 7.2% in January. At the same time, occupancy in the temporary segment (reservations of fewer than 10 rooms) decreased by 0.6% after increasing throughout most of 2023. As a result, group ADR increased to 4.5%, above the inflation rate, but temporary ADR growth remained stagnant.

Looking at day-of-week patterns, shoulder days ( 13%) and weekdays ( 7%) once again outpaced weekends ( 1%) in group occupancy growth in January.

The improvement in weekday group demand also correlated with food and beverage revenue in January, as all food and beverage items showed year-on-year improvement. Revenues in the food and beverage sector increased overall, with items such as service charges and banquets and catering showing the largest growth from last year.

Preliminary data for February showed that group occupancy was still increasing, albeit at a slower pace ( 4.6%). Still, weekday ( 8%) and shoulder ( 5%) growth was notable, while weekend group occupancy (-1%) declined.

Despite the recent slowdown, Group ADR growth has not slowed, averaging 5.7% over the past nine weeks. In the last full week of February, 15 of the top 25 markets saw year-over-year group share increases, with Oahu and Las Vegas posting double-digit ADR increases.

At the time of writing, group demand increased year-over-year in eight out of nine weeks in 2024. Demand is used for week-to-week year-to-year comparisons, while occupancy is used for month-to-month year-over-year comparisons because of the different calendar configurations. For example, November 2023 had 4 Tuesdays, while November 2022 had 5 Tuesdays.

According to STR’s weekly data (ending March 2), weekly group demand in the U.S. increased 9.1% year over year and was 1.9% above the 2019 comparable. Group ADR also continued to grow, maintaining growth above 5% for the fourth consecutive week. Most of the group demand growth occurred in the top 25 markets, with group share increasing by 11%. All other markets rose 1.4%. Eleven of the top 25 markets averaged above 11%, including Las Vegas, Houston, Dallas, Seattle, Orlando, San Francisco, Miami, Los Angeles, New York City, and Orange County (Anaheim). The strength of group demand will continue to be of particular interest throughout the spring season when analyzing the health of the industry.

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“U.S. hotel performance has been inching toward normalized levels over the past three quarters. The normalizing trend is evident in most data segments, but especially in recent months. …”
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