Occupancy Rates in Newark Expected to Fall Slightly Through 2019
New hotel rooms coming onto the U.S. market shouldn’t be a concern for established hotel operators,as demand will continue to exceed supply through 2019, according to CBRE Hotels’ Americas Research’s recently released September 2018 Hotel Horizons forecast report.
For Newark, CBRE Hotels Research is forecasting a 74.4 percent occupancy rate for the remainder of 2018 and a slightly lower 74.2 percent for 2019. Revenue Per Available Room (RevPAR) rates are projected to decrease from 4.9 percent to 3.2 percent in 2019, whilethe average daily rates (ADR), are forecast to decreasefrom 4.2 percent this year to 3.5 percent in 2019.
“The Newark lodging market continues to exhibit strength, achieving occupancy levels well above the long-run average owing to a broadening base of demand,” said Daniel Hanrahan, Director, CBRE Hotels.
Nationally, CBRE Hotels Research forecasts that supply will peak at a 2.0 percent gain in 2018 and then stabilize at the long-run average of 1.9 percent for the next two years. Further, the number of projects entering all phases of the development pipeline is declining.
“Now more than ever it is important for owners and operators to understand their local hotel market conditions and local economies when preparing their budgets for 2019,” said R. Mark Woodworth, senior managing director of CBRE Hotels’ Americas Research. “It is easy to be enthusiastically mesmerized by the positive outlook for the nationwide lodging market. However, don’t be caught off guard by not understanding what is happening in your neighborhood. It is very evident that local economic conditions, as well as changes to the local lodging supply, are going to significantly impact the performance of U.S. hotels in 2019.”
For media, data and analysis from the CBRE Hotels Research 2018-2019 forecast for the Newark market is available upon request. For clients, the September 2018 edition of Hotel Horizons®for the U.S. lodging industry and 60 major markets can be purchased by visiting: https://pip.cbrehotels.com
CBRE Hotels is a specialized advisory group within CBRE providing capital markets, consulting, investment sales, research and valuation services to companies in the hotel sector. CBRE Hotels is comprised of more than 385 dedicated hospitality professionals located in 60 offices across the globe.
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CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2017 revenue). The company has more than 80,000 employees (excluding affiliates), and serves real estate investors and occupiers through approximately 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
