Most of the revenue per available room across these markets came from weekday nights, although smaller markets like Miami, Nashville and New Orleans got most of their revenue from weekends.
During the past year, all of the top 25 U.S. markets saw higher average daily rates during the week than on the weekends, but the discrepancy varies depending on the relative strengths of their business and leisure allure.
That’s a conclusion that can be drawn from research firm STR, which looked at hotel average daily rate data from March 2014 to February 2015 in the top 25 U.S. markets. STR defines weekday nights as Tuesday through Thursday and weekend nights as Friday and Saturday and it didn’t consider Sunday and Monday nights as part of the analysis to get the most accurate picture as both nights are historically the slowest of the week.
Cities such as Boston, Washington, D.C., Denver, Houston, San Francisco and Seattle saw higher average daily rates during weekday nights and those same cities also had higher occupancy rates during weekday nights.
“Houston is definitely a business destination and continues to be a popular place for business travelers to meet, but clearly there is a weakness there on the leisure side,” said Henry Harteveldt, founder and travel industry analyst at Atmosphere Research Group. “I’m not surprised by the growth in Denver and Seattle during weekday nights which is likely led by business travelers.”
Other large business hubs like Atlanta, Chicago, Dallas, Los Angeles and New York had higher weekday daily rates rates but their occupancy rates were higher on weekends. The data also show hotels in at least 15 major U.S. cities such as Chicago, Los Angeles and New York, experienced higher weekend occupancy rates but at lower average daily rates.
Most of the revenue per available room across these markets also came from weekday nights, although smaller markets like Miami, Nashville and New Orleans got most of their revenue from weekends.
New York City had the smallest difference between weekday and weekend occupancy, with weekday occupancy at 87.1% versus 87.3% on weekends. Houston had the largest variance for average daily rates: Weekday rates were about 23% higher than weekend rates. Washington, D.C. ranks behind Houston with weekday rates about 20% higher than weekends.
“This report doesn’t really reveal anything new or surprising. Business travelers are in rooms on weekdays and they’re less concerned about room costs as they can usually expense those,” said Harteveldt. “What is really interesting is that cities like Nashville and Miami have been working to build up their convention businesses and certainly have a lot of other business in the city. But these cities really do come to life on the weekends too and have really evolved to have big leisure focuses.”
“There’s also lots of price competition in New York but also a lot of demand between leisure and business. As more hotels come online in New York, will we see more price pressure?”
Top 25 U.S. Markets For Average Daily Rate Variance Between Weekday and Weekend Nights, February 2015 to March 2014
|% Weekday Rates Were Higher Than Weekend Rates
|New York City
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Photo credit: New York City had the smallest difference between weekday and weekend occupancy last year. Pictured here are three hotels on the same block in Midtown Manhattan. Mark Lennihan / Associated Press