The coronavirus pandemic slashed revenue for the Texas hotel industry by nearly two-thirds, according to a report released Monday.
The state’s hotels took in $1.175 billion in the quarter ending June 30, a 64.1 percent decline from a year earlier, according to the report from Source Strategies, which tracks hotel occupancy and revenue.
“This is the biggest revenue drop we have ever seen, more than three times what we saw at the worst part of the Great Recession in 2009,” said Paul Vaughn, senior vice president of Source Strategies. “It was a precipitous demand drop across the board — business travel, leisure travel, everything was off in that quarter.”
The report shows that no Texas metro area was immune.
San Antonio hotels on average filled only 31.6 percent of rooms in the three months ending June 30, the lowest of any metro area in Texas, as the coronavirus pandemic kept travelers away and restricted how many rooms they could fill, according to the report.
The Dallas-Fort Worth-Arlington metro area eked by San Antonio, filling only 31.8 percent of its rooms, while Austin had an occupancy rate of 32.8 percent and Houston 36.8 percent, according to the report.
On ExpressNews.com: Report: San Antonio’s hotel industry may take years to recover
Revenue for San Antonio hotels plunged to $97.1 million for second quarter, down 74.1 percent from the same period a year ago when 67.2 percent of rooms were filled.
Austin-area hotels saw an even bigger revenue drop — 79.7 percent, the highest in the state, the report found. Hotels took in $93.2 million in the quarter.
Houston hotels had the smallest drop among the major metro areas, 61.4 percent. The area’s hotels took in $257.1 million in the second quarter.
“Clearly, the localities with the most to lose, lost the most,” Vaughan said. “You look at all the major metros: San Antonio, Dallas, Austin, Houston, everyone was way down.”
On ExpressNews.com: Hundreds of San Antonio Marriott workers to be laid off
While the situation is expected to improve for Texas hotels in the current quarter, Vaughn said it will take several years for hotels to achieve 2019 revenue and occupancy levels.
But hotels with a heavy debt load may not survive, he said.
“The hotels that were more marginal and were reliant on monthly income to get by will be affected first,” he said.
Vaughn said he expects to see some hotels failures as soon as this fall.
Randy Diamond covers tourism and the travel industry. To read more from Randy, become a subscriber. randy.diamond@express-news.net
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September 01, 2020 at 01:00AM
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Study: Texas hotel industry takes bigger hit in quarterly revenue from coronavirus than the Great Recession - San Antonio Express-News
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