PKF Consulting Outlook Forum provides insight into the Canadian Hospitality & Tourism Industry
Earlier this week, InstaFund Financial (Commercial) team member Corey Wicks attended the PKF Consulting Outlook Forum to gain some inside knowledge on the Canadian Hospitality & Tourism Industry. Largely, the forum focused on key statistics in nationwide lodging markets. In markets from St. John’s to Whistler, industry indicators such as revenue per available room (RevPAR), average daily rate per room (ADR) and occupancy rates were discussed.
While a complete overview of individual markets requires far more discussion than this post allows, some interesting industry trends were discussed. Nationwide, PKF Consultants noted a disconnect between the forces of supply and demand and the resulting RevPAR and ADR numbers. Although delays in hospitality development projects limited room supply and increased demand (occupancy) for existing lodging was noted in most markets, RevPAR and ADR still remained flat when an increase would normally be expected. In noting this anomaly, presenters at the forum cautioned that an individual statistic (like increased occupancy) does not necessarily reflect overall industry conditions and other statistics should be considered.
Focusing on Vancouver, the forum noted several factors contributing to a forecasted 6.1% year over year decrease in ADR in metro Vancouver. This 2011 decrease is explained in large by the 2010 spike in demand (and thus ADR) associated with hosting the Winter Olympic Games, and partially by the less than ideal weather in summer 2011, which decreased demand. The combination of these exacerbating abnormalities has resulted in an dramatic year over year decline in ADR in metro Vancouver. That being said, these conditions were unique to Vancouver and do not necessarily represent larger industry trends. The City of Richmond was also discussed with enthusiasm, as several developers have proposed large mixed-use developments near the Vancouver Airport.
Moving forward, the PKF Consulting Outlook Forum provided a positive nationwide industry outlook in the years to come. While RevPAR and ADR numbers are forecasted to improve modestly in 2012, the forum maintained that industry growth would truly rebound in the years 2013 to 2016.