Forecasting the Medium-Term Hurricane Impact on Hotels
Skift Take
Baird predicts short-term negative impacts on hotel revenues from recent hurricanes but expects a boost in the intermediate term due to FEMA, insurance, and clean-up crew spending, especially benefiting select service and extended-stay hotels
The DJIA was up 410 points on Friday while Nasdaq rose 61, the S&P 500 was up 35 points, and the 10-year treasury yield was down .02 to 4.07%. Lodging stocks were higher, with new highs scored by MAR, HLT, WH and CHH. AHT and BHR were both up 5%, but SOND fell -5% on the day.
Baird took a swing at what the recent hurricanes would do to some companies' P&L's. Baird said that in the short term, RevPAR is usually negatively impacted, but in the intermediate term, usually provides a boost with FEMA, insurance and clean-up crews spending lots of time there, mostly in select service and extended-stay hotels. Florida exposure to hotel REITs is high, pointing out the resort portfolios of HST and PEB as well as XHR and BHR.
STR reported US lodging data for the week ended October 5. The Rosh Hashanah holiday shift caused artificial weakness to the tune of RevPAR being down -7.7% year over year.
