In July, lodging revenues reached $183 million, reflecting a 3% increase from the previous year. The rental market saw a 9% rise in revenues, totaling $84 million. Hotel revenue was $99 million, lower than expected due to a slowdown in demand caused by fewer group and business travelers this month.
Year-to-date lodging revenues totaled $1.28 billion (approximately $4 per person in the U.S.), marking an 8% increase from last year. Hotel revenue contributed $790 million, accounting for 62% of the total revenue.
According to its Executive Director, Airbnb’s second-quarter earnings indicated a slowdown in overall growth across several key areas, with signs of decreasing demand from U.S. guests. However, AirDNA reports show that Puerto Rico continues to experience significant year-to-date rental revenue growth, reaching $491 million—a 13% increase compared to last year.
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According to San Juan Cruise Port reports, over 932,000 cruise ship passengers have arrived at the San Juan docks this year through July. While the local cruise market has not fully recovered from the impact of the pandemic, year-to-date results indicate a steady recovery, now reaching 88% of the 2019 record year. Refurbishment plans for the San Juan cruise piers—including modernizing the port experience, upgrading terminal buildings, enhancing the walkway in front of the bay, and other infrastructure repairs—are scheduled to begin soon.
According to Tourism Economics, overall cruise travel demand is elevated, with total passenger days up 7% through June. Sailings from the U.S. to all regions were 2% higher in the first six months of 2024 compared to the first half of 2019.
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In July, estimated lodging performance showed total demand growth of 2.6% compared to the previous year. However, demand for hotel room nights has remained static since Q2. In contrast, AirDNA estimates that booked rental listing nights have grown by 10% during the same period.
The hotel scenario was partly affected by a reduced group base and a decline in business transient travel. Despite these challenges, hotels have maintained record average rates of $273, a 1.2% increase from last year.
Year-to-date, total lodging demand has reached 712,000 room nights, a 7% increase compared to last year. Hotels account for 56% of the night market with an average rate of $310. While hotel demand has increased by 2% compared to last year, rental nights have surged by 13% year-to-date, averaging $243 per night.
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Contrary to the local industry, U.S. hotel demand began 2024 with a slow start but rebounded in Q2 with 1.4% growth over 2023, according to STR. Tourism Economics and STR report that higher-end hotels continue to outperform economy and midscale properties, reflecting the effects of inflation and higher interest rates on household budgets. Year-to-date U.S. lodging demand through June shows flat growth of 0.1% compared to last year, with the Mid-Atlantic and Northeast regions performing best.
GDP growth accelerated to 2.8% in the second quarter, signaling economic strength and reinforcing Tourism Economics’ early 2024 forecast for a soft landing. Consumer spending rose at a solid pace in June, and it is expected to continue this trend over the second half of 2024 as real income growth persists against a backdrop of strong household balance sheets, even amid a modestly higher U.S. unemployment rate.
Puerto Rico continues to outperform the U.S. average in leisure and hospitality job growth. June estimates from the Bureau of Labor Statistics report 99,900 leisure and hospitality jobs, a year-over-year increase of 8%, compared to the U.S. average of 2.5%.
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500 Calle De La Tanca
Building Ochoa, Suite 402B
San Juan, PR 00901, USA
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