2020 Devastated Philly's Hotel Industry: Report

PHILADELPHIA — The coronavirus devastated numerous industries in 2020 and will likely continue to wreak havoc for several months to come. And new data shows just how hard the hotel industry in Philadelphia was hit by the pandemic.

The City of Philadelphia, VISIT PHILADELPHIA, the Philadelphia Convention and Visitors Bureau, and the Greater Philadelphia Hotel Association Wednesday released a report on the negative impact to the hotel industry.

According to the report, hotel occupancy, average daily rate, and room revenue saw significant decreases last year.

Occupancy was down 59.5 percent year over year to 30.9 percent, average daily rate went down 22.7 percent year over year to $156.27, and room revenue went down 74.9 percent year over year to $176.9 million.

These figures come after a decade of prosperity and growth for hotels from 2009 through 2019.

"Our travel and tourism industry was hit hard by COVID-19, but its recovery is poised to begin in earnest in 2021. In fact, Tourism Economics estimates that Philadelphia will sell 660,000 more room nights in 2021 than we did in 2020," Mayor Jim Kenney said. "Those additional room nights, while still lagging behind 2019 levels, will be a positive step forward in bringing back tourism jobs and tax revenue that are critically important to our city’s vitality. It’s also exciting that four new hotels are opening here this year. That’s a sign of the private investment sector’s optimism in the future of Philadelphia’s hospitality industry, and it’s an optimism that I share."

Below are details on 2020's hotel industry impacts:

• Room Demand: 1.1 million room nights sold, down 67.5 percent. The market mix for those rooms breaks down as:
  • 36.2 percent: Business
  • 41.0 percent: Individual Leisure
  • 6.8 percent: Group
  • 6.1 percent: Contract
• Occupancy: 30.9 percent, down 59.5percent from prior year.
• Average Daily Rate (ADR): $156.27, down 22.7 percent from prior year.
• Revenue Per Available Room (RevPAR): $48.27, down 68.7 percent from prior year.
• Room Revenue: $176.9 million, down 74.9 percent from prior year.

"It’s no question that our hotel industry suffered greatly in 2020, but we’re working to build back our business in 2021 and beyond," said Bob Cosgrove, president, Greater Philadelphia Hotel Association. "While travel demand is expected to increase this year, returning to 2019 levels will take time. The recovery will begin with domestic leisure travelers — especially as vaccinations increase — and continue with business and group travel once in-person gatherings are permitted and travel budgets are restored. We’re grateful to Mayor Kenney for the City’s commitment to our industry and its recovery."

According to AIRDNA, in 2020, Center City Philadelphia saw a significant drop in demand for short-term lodging options such as Airbnb as well, with 189,500 room nights consumed by guests renting a private room or an entire home, down 43 percent year over year.