SAN JOSE — The battered hotel sector in the Bay Area remains years away from a full post-coronavirus recovery — but a significant rebound is expected to begin during 2021, lodging experts said Tuesday.
Hotels in Silicon Valley are expected to recover before their counterparts in Oakland, while hotels in San Francisco face the longest recovery period of the three major lodging regions in the Bay Area, according to a report released by hotel analysts with CBRE, a commercial real estate firm.
Ongoing rollouts of vaccines to combat the coronavirus, along with federal stimulus packages, have bolstered the prospects for the hotel sector, stated a report from CBRE Hotels Research.
“We expect hotels and drive-to destination resort areas catering to leisure travelers to continue to see the fastest gains in occupancy,” said Julie Purnell, executive vice president, CBRE Hotels Advisory.
Revenue per available room, or RevPAR, which is the most closely watched barometer of the health of the hotel industry, is expected to improve in Silicon Valley, Oakland, and San Francisco during 2021 compared with 2020, the CBRE reported stated.
Silicon Valley’s hotel market is expected to fully recover from its coronavirus ailments by sometime in 2023, measured by the region’s surpassing the pre-COVID revenue per available room and occupancy level of early 2020, CBRE Hotel Research analysts predicted.
Oakland hotels should fully recover their occupancy and RevPAR levels by 2024, stated the CBRE experts.
However, it will take until at least 2025 for San Francisco’s hotel market to recovery, according to CBRE.
“Based on our forecasts, the worst of the declines are now behind us,” said Rachael Rothman, head of Hotels Research & Data Analytics for CBRE.