A report by JLL Hotels & Hospitality reveals that Florida’s top hotel markets have been consistently outperforming national averages for revenue growth and pricing power. This has led to a boost in hotel development in the state. Last year, the top 10 lodging markets in Florida surpassed the national average for revenue per available room (RevPAR), with the Florida Keys standing out in occupancy and average daily rate.
In the first quarter of the year, the top 10 Florida hotel markets continued to shine, with all of them outperforming the U.S. national average for average revenue per available room. The rankings for the first quarter were led by the Florida Keys, followed by Palm Beach, Miami, Sarasota, Fort Lauderdale, Fort Myers, Orlando, Tampa, Melbourne, and Jacksonville. Despite increasing supply, Florida has maintained its ability to fill hotel rooms and maintain pricing power, with most of the top markets experiencing growth in revenue per available room.
Miami, for example, added hotels between 2014 and 2023, yet continued to see an average annual increase in revenue per available room of 2.1%. The city’s resilience can be attributed to hikes in daily rates at popular resorts. While there has been a shift in booking patterns this year, with some destinations experiencing a normalization in demand patterns, overall performance levels remain higher compared to 2019.
In contrast to the national trend towards midscale and premium economy brands, Florida’s top markets have been leaning towards full-service hotels. One-third of hotels delivered since 2022 were full-service properties, and about 60% of projects under construction in the state fall into this category. Investors have shown a preference for full-service hotels in key Florida destinations, leading to an increase in the price per guest-room key since the pandemic. The majority of top markets in Florida have also seen annualized growth in revenue per available room from 2014 to 2023.
Looking at the Accommodations Sector Stock Index Performance Year-to-Date, the performance of hotels and short-term rental sector stocks within the ST200 index is highlighted. The ST200 index includes publicly traded companies across global markets, such as international and regional hotel brands, hotel REITs, hotel management companies, alternative accommodations, and timeshares. This index provides insight into the financial performance of nearly 200 travel companies worth over a trillion dollars, offering a comprehensive view of hotels and short-term rental financial sector performance.
In conclusion, Florida’s top hotel markets have been demonstrating robust growth in revenue and pricing power, outperforming national averages and attracting investor interest. Despite an increase in hotel supply, the state has managed to maintain demand levels and pricing, with a focus on full-service hotels in key destinations. The Accommodations Sector Stock Index Performance Year-to-Date reflects the positive performance of hotels and short-term rental sector stocks within the ST200 index, showcasing the strength of the accommodations sector in the state.
