special event impact analysis · 2019-09-24 · sample event (2018) special event impact analysis...

Special Event Impact AnalysisSample Report (2018)

Example MarketSeptember, 2019

Special Event Impact Analysis

SAMPLE REPORT

Example Market, USA

August, 2018

Prepared for:

Client Name

Prepared by:

STR

735 East Main Street

Hendersonville, TN 37075

615-824-8664

str.com

For Additional Information Contact [email protected]

The STR Special Event Impact Analysis is a publication of STR and is intended solely for use by paid subscribers.

Reproduction or distribution of the Special Event Impact Analysis materials, in whole or in part, without permission of

STR is prohibited and subject to legal action. Site licenses are available. Ownership, distribution and use of the Special

Event Impact Analysis is subject to the terms of the contract you have entered into with STR. STR does not endorse

any particular organization, and no strategic advice or marketing recommendation is intended or implied.

Sample Event (2018) Special Event Impact Analysis

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Table of Contents

Table of Contents ................................................................................................... 2

Objective................................................................................................................ 3

Background: Sample Event (2018) ......................................................................... 3

Approach and Methodology .................................................................................. 3

Characteristics of the Example Market .................................................................. 5

Special Event Analysis ............................................................................................ 6

Company Contact Information ............................................................................. 13

Appendix I: Definitions ......................................................................................... 14

Appendix II: Hotels Included in the Analysis ......................................................... 15


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Objective

Understand, quantify, and illustrate the impact of a special event on city hotels. The event analyzed

in this report was the Sample Event which took place in Example Market, USA during a three-day

period spanning June 23-25, 2018.

Background: Sample Event (2018)

The Sample Event is a sporting event held June 23 – 25, 2018 in Market, USA. An estimated

6,000 athletes across the region participate in over two dozen difference events. The event

begins with an opening parade of athletes and concludes with an awards ceremony. Several

venues including ABC Swimming Club, XYZ Field House and MNO Pavilion were utilized for the

events. Additionally, evening entertainment is provided by local music and theater groups. The

next Sample Event will take place in Another Market, USA on June 22-24, 2019.

Approach and Methodology

This Special Event Analysis uses daily property-level data from STR’s proprietary databases to

explore how a one-time special event – the Sample Event held in Example Market – may have

impacted hotels across the Example Market. STR compares the actual performance of the

market during this period against the daily baselines established for those days. This baseline-

to-actual performance comparison during the event period allows for a reasonable inference of

the relationship between the special event and area hotel performance across the Example

Market.

STR utilized daily hotel data containing the key performance indicators (KPIs) for the hotels

located within the most centralized county (Example County) of the STR defined Example

Market. Unless noted otherwise, only actual data from daily-reporting hotels has been utilized

for this study. STR receives monthly data from other hotels, which may be used in other STR

products or reports.

The hotel performance data used includes Occupancy (Occ), Average Daily Rate (ADR), revenue

per available room (RevPAR) and Room Demand. The market’s daily KPIs were compared to

their corresponding modeled, long-term averages or daily baseline. The daily baselines are

generated based on a three-year history of KPIs for that specific day of the year, as well as

similar days of the year. The days are adjusted to account for the same day of the week, and

for holidays. The KPIs are also adjusted to account for inflation using indices provided by the


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4

U.S. Bureau of Labor Standards. All ADR and RevPAR values were inflation normalized using a

December, 2017 base date.1

This report utilizes a total of 96 daily-reporting hotels. Geographic and class characteristics of

these hotels are presented at the end of this report and a complete listing of the hotels used in

this study are found in Appendix II.

The bulk of this study relies on the relationship of the event data and hotel market

performance data. The percentage changes from the daily baselines are then compared to the

room placement event data. This relationship is examined in detail throughout the study, and

performance change or premium is always in comparison to the daily baselines.

1 http://www.bls.gov/data/inflation_calculator.htm


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5

Characteristics of the Example Market

This map identifies hotels by their class level.2 Example Market has few properties in the top

class tier (i.e. Luxury), but it does have 17 hotels (39% of total rooms) in the Upscale and Upper

Upscale class brackets. The remaining Example Market properties fall in the Upper Midscale,

Midscale and Economy class.

Figure 1. Map of Example Market, USA Market by Hotel Class

2 Hotel class segment definitions are defined in Appendix I.


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Special Event Analysis

Multiple types of visualizations are provided in the following section which assess the impact of

Sample Event from different perspectives. For index values and KPI premiums alike, actual daily

performance is compared against a same-day historical baseline. The values are entirely

seasonally adjusted while also accounting for the normal variability in performance seen by day

of week.

In this analysis we look at Occupancy, Average Daily Rate (ADR) and Revenue per Available

Room (RevPAR) – common performance metrics in the hotel industry. An analysis of Room

Demand is also provided as a metric that can more easily be communicated to non-hoteliers,

i.e. different agencies involved with and affected by the planning and management of this

special event.

Room Demand

• The market’s daily reporting hotels had an additional 8,419+ rooms filled above their

normally expected room demand for the three-day event period. Saturday, June 23

through Monday, June 25, 2017 account for the bulk of room gains, averaging an extra

2,302 rooms/day.

• Monday, June 25 experienced the largest daily premium for rooms, an additional +2,736

rooms; this is on top of the market’s normal daily demand of 7,843 rooms for the

market.

Occupancy

• Above normal Occupancy gains appear to be the primary driver of the market’s RevPAR

premiums.

• Beginning on June 23 and lasting through June 25, there were three consecutive days in

which indexed occupancy surpassed 30% above normal for the entire market.


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ADR

• While ADR was slightly above normal for all days of the event, gains in this performance

metric were comparatively flat over the event period. Five days (June 22-26) saw

market ADR premiums higher than 10% above their normal levels, but there were no

days for which ADR indexed higher than 20% above baseline.

• The greatest boost to ADR was seen on Sunday and Monday nights of the event, with

boosts of more than $10 to market ADR on each night.

RevPAR

• The entire event period averaged a +20% daily indexed gain in market RevPAR above its

baseline, including shoulder dates. Market performance was particularly strong from

June 23-25. Indexed RevPAR averaged +40% above normal during this span.

• Market RevPAR hit its daily indexed peak (+49%) on the Monday night (June 8th) before

the Friday Celebration of Athletes/Olympic Day ceremonies. Translated into dollars,

average market RevPAR for Thursday, June 8 was $100, as compared to the normal

RevPAR of $67, a premium of +$33.

• The Thursday leading into the event was the only day studied that saw below-average

performance for Demand, Occupancy, Rate and RevPAR. All other days of the event

period and shoulders saw measurable boosts across the board.


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Figure 2. Room Demand Index by Event Day

(*Note: Baseline or “normal” daily performance =100%)

Figure 3. KPI Indices by Event Day


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Figure 4. Room Demand Premiums by Event Day

Date Baseline

Demand

Actual

Demand

Demand

Premium

Thursday, June 21, 2018 7,834 7,622 -212

Friday, June 22, 2018 9,305 10,114 808

Saturday, June 23, 2018 5,656 7,341 1,685

Sunday, June 24, 2018 8,503 10,989 2,486

Monday, June 25, 2018 7,843 10,579 2,736

Tuesday, June 26, 2018 9,030 9,848 817

Wednesday, June 27, 2018 9,376 9,474 98


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Figure 5. Occupancy Premiums by Event Day

Date Baseline

Occupancy

Actual

Occupancy

Occupancy

Premium

Thursday, June 21, 2018 70% 66% -4%

Friday, June 22, 2018 84% 88% 4%

Saturday, June 23, 2018 50% 64% 13%

Sunday, June 24, 2018 74% 95% 21%

Monday, June 25, 2018 69% 92% 23%

Tuesday, June 26, 2018 78% 85% 7%

Wednesday, June 27, 2018 81% 82% 1%


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Figure 6. Average Daily Rate Premiums by Event Day

Date Baseline

ADR Actual ADR

ADR

Premium

Thursday, June 21, 2018 $103 $97 ($5)

Friday, June 22, 2018 $108 $113 $6

Saturday, June 23, 2018 $96 $99 $4

Sunday, June 24, 2018 $110 $120 $10

Monday, June 25, 2018 $103 $115 $12

Tuesday, June 26, 2018 $112 $117 $4

Wednesday, June 27, 2018 $112 $114 $2


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Figure 7. RevPAR Premiums by Event Day

Date Baseline

RevPAR

Actual

RevPAR

RevPAR

Premium

Thursday, June 21, 2018 $68 $61 ($7)

Friday, June 22, 2018 $85 $94 $9

Saturday, June 23, 2018 $46 $60 $14

Sunday, June 24, 2018 $77 $108 $31

Monday, June 25, 2018 $67 $100 $33

Tuesday, June 26, 2018 $83 $94 $11

Wednesday, June 27, 2018 $86 $89 $3


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Company Contact Information

STR, Inc.

735 East Main Street

Hendersonville, TN 37075

(615) 824-8664

M. Brian Riley Kelsey Waite

Research Analyst, Market Insights Business Development Executive, Destinations

(615) 824-8664 ex. 3443 (615) 824-8664 ex. 3458

[email protected] [email protected]

Chris Klauda Jennifer Foster

Senior Director, Market Insights Business Development Executive, Destinations

(615) 824-8664 ex. 3466 (615) 824-8664 ex. 3487

[email protected] [email protected]

Brannan Doyle

Research Analyst, Market Insights

(615) 824-8664 ex. 3426

[email protected]


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Appendix I: Definitions

Average daily rate (ADR): A measure of the average rate paid for rooms sold, calculated by

dividing rooms revenue by rooms sold.

Chain Scale: An industry segmentation by which chain-affiliated hotels are grouped based on

the national average room rate of that chain. Independent hotels, regardless of their average

room rates, are included as a separate Chain Scale category. There are seven chain scale

segments: Luxury, Upper-Upscale, Upscale, Upper-Midscale, Midscale, Economy, and

Independents.

Class: Class is an industry categorization that includes chain-affiliated and independent hotels.

The class for a chain-affiliated hotel is the same as its chain scale. An independent hotel is

assigned a class based on its ADR, relative to that of the chain-affiliated hotels in its market.

There are six class segments: Luxury, Upper-Upscale, Upscale, Upper-Midscale, Midscale, and

Economy.

CVB: Convention and visitors bureau

Hotel: A hotel is partly defined on the basis of three exclusionary criteria. It must a) generate

revenue on a nightly basis, b) have 8 or more rooms, and c) be open to the public (excludes

those properties requiring membership, affiliation or club status).

Key Performance Indicator (KPI): A measure of hotel performance including occupancy, ADR,

and RevPAR.

Occupancy: The percentage of available rooms that were sold during a specified period of

time. Occupancy is calculated by dividing the number of rooms sold by the number of rooms

available.

Restaurant: An establishment which prepares on-site food and serves at least lunch and dinner

to customers. The restaurant may be leased out to third parties and not operated by the hotel

itself. Hotels which have a restaurant are considered to be full service properties.

RevPAR: Revenue Per Available Room is calculated by dividing room revenue by the number of

rooms available for a specified period. This provides a standardized way of measuring hotel

performance, accounting for the size of the hotel or its number of rooms. RevPAR is the most

complete KPI for the rooms department, because it accounts for both the occupancy and the

ADR of the hotel.


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Appendix II: Hotels Included in the Analysis

Census ID Property Name City Class

10001 Sample Property #1 Client City Upper Midscale Class

10002 Sample Property #2 Client City Upper Upscale Class

10003 Sample Property #3 Client City Economy Class


10005 Sample Property #5 Client City Upscale Class


10007 Sample Property #7 Client City Midscale Class







































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