By Margaret Jackson / NewsBreak Denver
(Denver, Colo.) Denver’s hotel market is marching toward recovery.
Denver’s hotel occupancy rate is expected to rise 7.7% this year, averaging 63% for 2022, according to CBRE Hotels Research’s May report.
While it’s still below pre-pandemic levels of 73% in 2019, CBRE expects occupancy to rise over the next several years, reaching 72% in 2021.
“Denver’s recovery trails the national forecast due to the large amount of new supply introduced into the market within the past five years or that was in the construction pipeline prior to the onset of the pandemic,” said Zachary Alm, vice president with CBRE’s Valuation & Advisory Services in Colorado.
“The bulk of new supply since 2017 largely consists of upper and mid-priced properties — categories most negatively impacted by the pandemic.
“The good news is that upper and mid-priced properties are forecast to see the largest gains in demand and RevPAR in Denver over the next five years.”
Two other hotel performance metrics — average daily rate (ADR) and revenue per available room (RevPAR) — are on track to exceed pre-pandemic levels within the next two years.
ADR, which averaged $136.68 in 2019, is forecast to hit $131.42 this year and exceed pre-pandemic rates by 2023 at $139.39.
RevPAR’s recovery is expected to surpass 2019’s rate of $100.32 by 2024, reaching $105.42. RevPAR is expected to increase 21% year-over-year this year, averaging $83.20.