Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Caribbean resorts now seeing big drops in RevPAR, occupancy

Caribbean resorts now seeing big drops in RevPAR, occupancy

Although large swaths of the Caribbean's tourism sector remained relatively strong this past summer, a recent steep decline in hotel RevPAR and occupancy throughout the region could signal longer-term trouble going forward.

According to data from STR, hotel occupancies across the Caribbean began dropping in April and continued to steadily slip through the summer.

In August, overall occupancies in the region fell 5.6% from the same period last year, to 62.5%. Likewise, Caribbean RevPAR started trending downward in June and July, eventually falling 5.3%, to $112.54 for August.

"Room supply in the Caribbean continues to grow at around 3% [year-to-date], which is certainly healthy," said Jan Freitag, STR's senior vice president of lodging insights. "But that growth is happening while demand is weakening, and that then translates into occupancy declines. And if there are occupancy declines, we normally see rate growth get hit. Still, this is a market-by-market situation, and not everyone in the Caribbean is being impacted the same way."

Among the destinations hit hardest by slowing demand is the Dominican Republic, which was left reeling this summer after a spate of tourist deaths there led to a steep drop-off in bookings. In June, following widespread media coverage of the incidents - which many consumer media labeled "mysterious," even though most were quickly found to have been due to natural causes - STR reported that hotel occupancies in the Dominican Republic plummeted 12.7%, to 66.6%.

Occupancies dropped further in July and August, down 20% and 16.2%, respectively, while August RevPAR in the D.R. dipped nearly 26%, to $69.82.

Frank Comito, CEO and director general of the Caribbean Hotel and Tourism Association (CHTA), said, "The D.R. has seen a drop in RevPAR and ADR, which hopefully they can get back up. If one of the [market] leaders is having to discount in order to bring back business that they've lost, that's not good for the entire region. But typically, when we see a destination have some unfortunate publicity like this, the impact lasts for several months, and then it actually starts rebounding rigorously."

According to Julie Banning, a travel advisor with New York-based Embark, the Dominican Republic is primed to bounce back, and the bad press appears to be petering out.

"I don't think this is going to affect the D.R. in the long term," Banning said. "Our clients feel confident when they travel to the five-star resorts there, and we have a lot of repeat travelers who want to continue going to the D.R. And nowadays, when you look at the news, where did that story go? Everyone seems to have moved on. I think we'll see the numbers going back up this winter."

A rebound in the D.R. alone, however, might not be enough to solve the Caribbean's hotel occupancy problems. Cuba and Puerto Rico also saw summer business slow, with the former impacted by the Trump administration's travel restrictions and the latter facing lingering challenges following 2017's Hurricane Maria.

"There's still this image out there that Puerto Rico is recovering from the hurricane," Banning said. "Some people still think there's devastation, when that's not true."

For August, Cuba's occupancy slipped 13.1%, to 50%, and RevPAR in the market dropped 31.5%, to $31.77, according to STR. Concurrently, Puerto Rico's occupancy was down 4.3%, to 68.1%, and RevPAR fell 3.3%, to $123.12.

Meanwhile, the fact that traveler misconceptions continue to plague Puerto Rico certainly doesn't bode well for the Bahamas, which just last month was battered by Hurricane Dorian.

But while the vast majority of the Bahamas was spared any significant damage - with destruction largely limited to Grand Bahama and the Abaco Islands -- both Banning and Comito expressed concern about post-storm consumer perceptions.

"Only 20% of the Bahamas has been impacted," Comito said, "but the rest of the country is still dealing with the perception that they've been affected."

Threatening to further exacerbate the region's woes is the demise of tour operator Thomas Cook, which abruptly ceased operations in late September. Although the company's German airline, Condor, has remained in business with the help of a government-backed loan, the group's collapse is expected to hamper European lift to the Caribbean.

Sue Springer, director for corporate and government relations at London-based trade and investment consultancy the Caribbean Council, estimated that Thomas Cook accounted for 62% of all Caribbean flights from Germany and roughly 10% of Caribbean flights from the U.K.

Comito listed Barbados, St. Lucia, Jamaica, Cancun and the D.R. as destinations most likely to be impacted.

"We were expecting 400,000 visitors during the remainder of the fall season and winter season via Thomas Cook, and that includes Condor [business]," he said. "However, the German government bailing Condor out will protect a good portion of that business, around 60% of that 400,000."

Comito said he is optimistic that the gap left by Thomas Cook will soon be filled, with the CHTA working to attract tour operators and "find alternative ways to meet" existing European demand.

He also remains optimistic about the Caribbean as a whole, pointing to positive trends in Turks and Caicos, Aruba, Anguilla and Barbados as well as an improving outlook for Cancun, where issues surrounding higher-than-usual levels of sargassum appear to be subsiding.

"I wouldn't say there are any yellow flags for the whole region yet at this point," Comito said. "Out of the 16 destinations reporting for August, nine of them were up on occupancy, and seven were down. Assuming we don't see an acceleration of any kind of global economic downturn, growth in demand has kept up with supply, and we're hopeful that will continue.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
U.S. and Hungarian Officials Talk About Economic Collaboration and Sanctions Strategy
Technology Giants Activate Lobbying Campaigns Against Strict EU Regulations
Pope Francis Admitted to Hospital in Rome Amid Increasing Speculation on Succession
Zelensky Calls on World Leaders to Back Peace as Tensions Rise with Trump
UK Leader Keir Starmer Calls for US Security Guarantee in Ukraine Peace Deal
NATO Chief Urges Higher Defense Expenditure in Europe
The negotiation teams of Trump and Putin meet directly, establishing the groundwork for a significant advancement.
Rubio Touches Down in Riyadh Before Key U.S.-Russia Discussions
Students in Serbian universities Unite to Hold Coordinated Protests for Accountability.
US State Department Removes Taiwan Independence Statement from Website
Abolishing opposition won't protect Germany from Nazism—this is precisely what led Germany to become Nazi!
Transatlantic Gold Rush: Traders Shift Bullion in Response to Tariff Anxieties and Market Instability
Bill Ackman Backs Uber as the Company Shifts Towards Profitability
AI Titans Challenge Nvidia's Supremacy in Light of New Chip Innovations
US and Russian Officials to Meet in Saudi Arabia Over Ending Ukraine Conflict. Ukraine and European leaders – who profit from this war – excluded from the negotiations.
Macron Calls for Urgent Summit as Ukraine Conflict Business Model is Threatened
Trump’s Defense Secretary: Ukraine Won’t Join NATO or Regain Lost Territories
Zelensky Urges Europe to Bolster Its Military in Light of Uncertain US Backing
Chinese Zoo Confesses to Dyeing Donkeys to Look Like Zebras
Elon Musk is Sherlock Holmes - Movie Trailer Parody featuring Donald Trump's Detective
Trump's Greenland Suggestion Sparks Sovereignty Discussions Amid Historical Grievances
OpenAI Board Dismisses Elon Musk's Offer to Acquire the Company.
USAID Uncovered: American Taxpayer Funds Leveraged to Erode Democracy in Europe Until Trump Put a Stop to It.
JD Vance and Scholz Did Not Come Together at the Munich Security Conference.
EU Official Participates in Discussions in Washington Amid Trade Strains
Qatar Contemplates Reducing French Investments Due to PSG Chief Investigation
Germany's Green Agenda Encounters Ambiguity Before Elections
Trump Did Not Notify Germany's Scholz About His Ukraine Peace Proposal.
Munich Car Attack Escalates Migration Discourse Before German Elections
NATO Allies Split on Trump's Proposal for 5% Defense Spending Increase
European Parliament Advocates for Encrypted Messaging to Ensure Secure Communications
Trump's Defense Spending Goal Creates Division Among NATO Partners
French Prime Minister Bayrou Navigates a Challenging Path Amid Budget Preservation and Immigration Discourse
Steering Through the Updated Hierarchy at the European Commission
Parliamentarian Calls for Preservation of AI Liability Directive
Mark Rutte Calls on NATO Allies to Increase Defence Expenditures
Dresden Marks the 80th Anniversary of the World War II Bombing.
Global Community Pledges to Aid Syria's Political Transition
EU Allocates €200 Billion for AI Investments, Introduces €20 Billion Fund for Gigafactories
EU Recognizes Its Inability to Close the USAID Funding Shortfall Due to Stalled US Aid
Commission President von der Leyen Missing from Notre Dame Reopening Due to Last-Minute Cancellation
EU Officializes Disinformation Code for Online Platforms, Omitting X
EU Fails to Fully Implement Key Cybersecurity Directives
EU Under Fire for Simplification Discussions Regarding Corporate Sustainability Reporting
Shein Encountering Further Information Request from the EU During Ongoing Investigation
European Commission Initiates Investigation into Shein as It Aims at Chinese E-Commerce Regulations
German Officials Respond to U.S. Proposal for Peace Talks with Russia
Senate Approves Robert F. Kennedy Jr. as Secretary of Health and Human Services.
Trump and Putin Engage in Discussions on Ukraine Peace Negotiations Amid Worldwide Responses
Honda and Nissan End Merger Talks
×