A professional corporate housing provider’s unique ability to maintain a flexible inventory of properties allows the industry to be more nimble than their competitors facing similar market conditions. - Piper Ayala, CCHP, ExecuStay Midwest
Indianapolis, IN (PRWEB) April 18, 2013
The Corporate Housing Providers Association (CHPA) released the annual Corporate Housing Industry Report – 2012 highlighting the industry’s key performance indicators for North America, along with market-specific information in more than 60 metropolitan statistical areas (MSAs). Overall, the corporate housing industry remains strong despite a challenging business climate. In the US, industry revenue increased to $2.66 billion in 2012.
“Corporate housing still made gains in revenue in 2012 even though companies faced apartment inventory shortages and increased competition from other lodging choices,” remarks CHPA CEO, Mary Ann Passi, CAE. “With apartment communities having the lowest vacancies since 2002, finding favorable lease terms for corporate housing providers was and remains challenging.”
All of the gains in the corporate housing revenues came from increasing the average rate which rose 6.1%. ADR for corporate housing was significantly higher than the overall hotel average rate which increased 4.2% according to Smith Travel Research (STR), due to increased apartment rental costs. Similarly, it tracked higher than upscale extended-stay hotels which reported a 5.5% increase in average rate in 2012 compared to the prior year.
“A professional corporate housing provider’s unique ability to maintain a flexible inventory of properties allows the industry to be more nimble than their competitors facing similar market conditions,” says CHPA President, Piper Ayala, CCHP of ExecuStay Midwest. “Even as hotels and extended-stay properties increased their market share, in the face of increased rents, the corporate housing industry still increased revenues through longer stays and successfully meeting client needs.”
While relocation and contract work remain the strongest uses for corporate housing, many providers also experienced a dramatic decrease in government or military stays due to spending cuts and significant restrictions on travel. As the government sequestration continues and budgets remain tight, corporate housing providers remain hopeful for a stronger business economy, a more favorable job market with more relocations and an increase in long-term stays needed by clients.
Per the Report, several other key performance indicators include:
- US corporate housing inventory is estimated at almost 63,000 rental units, with the Canadian market at approximately 6,500 rental units.
- Occupancy in the US remained flat at almost 89%, while Canadian providers saw an increase in average occupancy from 79.5% to 86.2%.
- The average length of stay in 2012 was 88 nights. This has been on an upward trend since 1999. The average of 92 nights in 2009 was the only year higher than 2012.
- In the US, relocation continues to be the main reason for client stays, while in Canada, project/training is the major reason clients stay in units, with relocation a close second.
- Average Daily Rate (ADR) increased approximately $7 in the US and $2 in Canada.
The complete report is available complimentary to members of the media. CHPA representatives are available for comments regarding the data and its application to the corporate housing industry. Please contact Amanda Cook, acook(at)chpaonline(dot)org or (317) 328-4631 for more information on interviews and article opportunities.