HotelsMag September 2024 | Page 49

U . S . Hotels – Parking Department Profits by Property Type

2023 Parking Department Profits as a Percent of 2019 Parking Department Profits

150 140 130 120 110 100 90 80 70 60 50 40 30

2019 2020 2021 2022 2023 All Hotels

Full Service

Limited Service

CBRE Hotels Research , Trends ® in the Hotel Industry Confidential & Proprietary | © 2024 CBRE , Inc .

revenue . Resort hotels earned the most at $ 14.85 POR , while limited-service hotels earned the least at $ 8.35 . Though revenue volume POR may be the greatest at resort hotels , it still represents just 1.9 % of their total hotel operating revenue . Conversely , parking revenue represents a significant portion of income at those extended-stay hotels that charge for this service , due to the long length-of-stay at these properties that contributes to the significance of this revenue . Other hotels benefiting from a relatively high percentage of parking revenue are urban ( 3.6 %) and airport ( 3.4 %) hotels .

Extended Stay

All-Suite Convention Resort Hotels

U . S . Hotels – Parking Department Revenue by Location

Indexed Parking Revenue : 2019 = 100

130 120 110 100 90 80 70 60 50 40 2019 2020 2021 2022 2023

PARKING PROFITS Consistent with the increase in revenue , hotel parking profits have also increased from 2019 to 2023 . On average , the properties in our sample achieved parking department profits during 2023 that were 32.3 % greater than 2019 profit levels . Resort hotels , as well as properties in resort / destination and airport locations , achieved the greatest gains in parking department profits .

In 2023 , the number of occupied rooms at the hotels in our sample was still 9.1 % below 2019 levels . With parking revenues growing and occupancy levels lagging , the implication is an increase in the price charged by hotels for guest parking . Like ADR driving RevPAR , hoteliers have raised parking prices to cover rising costs of parking operations . This becomes evident when looking at recent trends in parking department profit margins . Since 2019 , the average parking department profit margin for the hotels in our sample has increased from 57.1 % in 2019 to 61.3 % in 2023 . Per the Uniform System of Accounts for the Lodging Industry , parking department profit margins ( like all operated departments ) are calculated based on just the direct department expenses , such as labor and supplies . This is before the deduction for overhead expenses , such as administration , marketing , maintenance , utilities , property taxes and insurance .

The 61.3 % parking department profit margin means parking departments are more efficient than hotel revenuegenerating departments . As a result of these operating efficiencies , hotel parking department profits comprised 53.1 % of the total other-operated department profits at the hotels in the sample during 2023 .

As parking revenues and profits have grown , more hoteliers have implemented pay-for-parking at their hotels during the past five years . In 2019 , 17.0 % of all the hotels in CBRE ’ s “ Trends ” database reported parking revenue ; this number rose to 22.3 % in 2023 .

EV CHARGING STATIONS Driven by consumer demand , brand requirements and government regulations , hotel owners are facing the need to install Electrical Vehicle Charging Stations ( EVCS ) at their properties . According to a 2022 report from Greenview and the AHLA , 26.6 % of hotels in the U . S . had EVCS installed on their property ; we surmise that this figure has increased since then . Installations were most prevalent at full-service hotels and properties operating in higher-chain-scale categories . Besides

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