U.S. Hotel Industry Chalked Up Record Highs in 2005

The year 2005 marked the most profitable year ever (in absolute dollars) for the US Hotel Industry.

Based on statistics compiled by Smith Travel Research (STR), the industry generated some $122.7 billion in revenues and $22.6 billion in profits last year. This profit number is slightly above the $22.5 billion that the industry generated in the year 2000, the highest level achieved prior to 2005.

Nationwide average daily rate (ADR) and occupancy figures increased 5.4 percent and 2.9 percent, respectively, in 2005 and the accelerated growth in ADR helped hoteliers to increase their profits.

The sustained increase in demand, especially from group and transient business travelers, coupled with the limited number of newly built rooms, should translate into even higher occupancies and room rates for existing hotels.

Smith Travel Research is the recognized leader for US Lodging Industry benchmarking. For over 20 years, STR has collected monthly and daily operating data and reported on the state of the U.S. lodging industry.