PERSPECTIVE
Parking and EV stations charge U . S . hotel performance
Contributed by ROBERT MANDELBAUM , RESEARCH DIRECTOR , CBRE HOTELS RESEARCH , JIM HURLESS , GLOBAL REAL ESTATE LEADER FOR ELECTRIC VEHICLE INFRASTRUCTURE , CBRE
Parking revenues have increased by 23.1 % from 2019 to 2023 , based on a sample of U . S . properties in CBRE ’ s “ Trends in the Hotel Industry ” database , which is more than four-times greater than the growth rate for total hotel revenues during that period . Not only is parking a growing source of revenue , but it is relatively profitable , as well . In 2023 , parking department profit margins for the CBRE sample were 61.3 % of total department revenue , while the average profit margin for all other-operated departments was 58.7 % at those hotels .
While the contribution to revenues and profits is welcomed news to hotel owners and operators , the expanded offering of electric vehicle charging stations at hotels meets a growing need of hotel guests , as well as municipal requirements . Even if guests are not driving their electronic vehicles to a hotel , an increasing number of them are seeking hotels with positive ESG policies . The offering of EV charging stations is viewed as a commitment to reduce the carbon footprint of a hotel .
To analyze trends in U . S . hotel parking revenue from 2019 through 2023 , CBRE studied a sample of 1,178 hotels that participated in our annual “ Trends in the
Hotel Industry ” survey . In 2023 , these hotels averaged 283 rooms in size , an occupancy of 69.7 % and an average daily rate of $ 237.48 . Since the sample consists solely of properties that reported parking revenue , it is skewed toward full-service hotels ( 63.6 % of the sample ), and those located in urban areas ( 58.0 %). This explains the relative high room counts and average daily rates for the sample .
NOT THE LAST RESORT When analyzing the growth in parking revenue across property types and location categories , we rely on revenue peroccupied-room ( POR ) to hold constant the impact of relative changes in occupancy . For example , the extended-stay hotel occupancy rate in 2023 was just a 1.0 percentage point below the 2019 occupancy level , while occupancy rates at convention hotels were still 8.4 percentage points behind 2019 averages .
From 2019 to 2023 , resort hotels have enjoyed the greatest increase in parking revenue POR . Most of this increase occurred from 2021 to 2023 when resort properties were extremely popular with travelers and hotel operators had the leverage to impose parking fees and / or
increase prices . Convention hotels , on the other hand , achieved the least gain in parking revenue ( 14.2 %), which is consistent with the lag in the recovery of group demand .
Analyzing parking revenue growth POR by location category , we find hotels located in resort destination areas to have enjoyed the greatest increases for the above reasons . Airport hotels achieved the second-greatest percentage increase in parking revenue from 2019 to 2023 , as these properties have taken advantage of their location by generating parking revenue from local citizens using the airport to fly out of town . In 2023 , the average hotel in the CBRE sample earned $ 11.53 POR in parking
Robert Mandelbaum
48 hotelsmag . com September 2024