At year-end 2007, national occupancy levels were recorded at 65% with an average daily rate of $127. Although demand was not as strong as the 4 to 5% annual growth levels experienced during the 2004-2006 period, the Canadian accommodation industry posted a respectable 2.7% growth in 2007, one percentage point ahead of the national supply growth of 1.7%. With a further 1.8% increase in supply expected in 2008, occupancy is projected to improve to 66%, reflecting a continued 3.0% growth momentum. Average daily rates are forecast to increase by 3% in 2008 to reach $131.
MAJOR URBAN MARKET OCCUPANCY PERFORMANCE |
|
2005
Actual |
2006
Actual |
2007
Actual |
2008
Projection |
Vancouver |
69% |
72% |
74% |
74% |
Calgary |
70% |
74% |
74% |
74% |
Edmonton |
66% |
72% |
75% |
75% |
Winnipeg |
62% |
65% |
68% |
71% |
Toronto |
67% |
66% |
67% |
67% |
Niagara Falls |
57% |
58% |
57% |
58% |
Ottawa |
65% |
69% |
70% |
71% |
Montreal |
68% |
68% |
67% |
66% |
Quebec City |
64% |
63% |
62% |
63% |
Halifax/Dartmouth |
70% |
69% |
69% |
69% |
CANADA |
63% |
65% |
65% |
66% |
MAJOR URBAN MARKET AVERAGE DAILY RATE PERFORMANCE |
|
2005
Actual |
2006
Actual |
2007
Actual |
2008
Projection |
Vancouver |
$121 |
$126 |
$133 |
$139 |
Calgary |
$115 |
$127 |
$142 |
$152 |
Edmonton |
$99 |
$103 |
$113 |
$121 |
Winnipeg |
$95 |
$99 |
$103 |
$108 |
Toronto |
$130 |
$135 |
$136 |
$141 |
Niagara Falls |
$142 |
$143 |
$144 |
$148 |
Ottawa |
$126 |
$128 |
$133 |
$137 |
Montreal |
$139 |
$140 |
$137 |
$140 |
Quebec City |
$139 |
$139 |
$138 |
$141 |
Halifax/Dartmouth |
$122 |
$124 |
$126 |
$129 |
CANADA |
$119 |
$123 |
$127 |
$131 |
MAJOR URBAN MARKET REVPAR PERFORMANCE |
|
2005
Actual |
2006
Actual |
2007
Actual |
2008
Projection |
Vancouver |
$84 |
$91 |
$98 |
$103 |
Calgary |
$81 |
$95 |
$105 |
$112 |
Edmonton |
$65 |
$74 |
$85 |
$91 |
Winnipeg |
$59 |
$64 |
$70 |
$77 |
Toronto |
$86 |
$89 |
$91 |
$94 |
Niagara Falls |
$81 |
$83 |
$82 |
$85 |
Ottawa |
$82 |
$88 |
$94 |
$97 |
Montreal |
$94 |
$95 |
$92 |
$92 |
Quebec City |
$88 |
$87 |
$85 |
$88 |
Halifax/Dartmouth |
$86 |
$85 |
$88 |
$89 |
CANADA |
$75 |
$79 |
$83 |
$86 |
In 2007, Edmonton led the country in demand growth at 5.1%, while Calgary was the leader in rate growth, posting double-digit growth of 11.8%. For 2008, Calgary is projected to maintain a 74% occupancy at an ADR of $152 – a 7% increase over 2007. For Edmonton, PKF projections call for a further 4.8% in supply in 2008, with occupancy holding at 75%, and the ADR rising by 7% to $121.
Vancouver closed the year at 74% occupancy and grew by 5.2% in ADR to $133. With a 1.4% increase in supply, Vancouver is projected to maintain a 74% occupancy in 2008, with ADR improving by 4.5% to $139.
By year-end 2007, demand in Toronto was up by just under 2.9%, with ADR edging up by 0.7% to reach $136. This year, Toronto is expected to see a 2.1% growth in supply, and a 2.0% growth in demand. Toronto is forecast to achieve a 67% occupancy in 2008, and accelerate the city’s average daily rate by 3.2% to reach $141 by year-end.
While Montreal underwent a 5% growth in supply in 2007, and 4% increase in demand, the city’s rate suffered, declining by 1.8% to $137. In 2008, Montreal is expected to undergo a further 4.3% increase in supply, with demand growth at 2.5%, resulting in a projected 66% occupancy and an average daily rate of $140.
From a RevPAR growth perspective, the best performing markets in 2007 were Edmonton (up 13.8%), Calgary (up 11.3%), Winnipeg (up 8.3%), Vancouver (up 7.6%), and Ottawa (up 6.6%). The weakest markets were Montreal (down 2.6%), Quebec City (down 1.6%), Niagara Falls (down 1.0%) and Toronto (up 1.6%).
Fran Hohol, CMC
Principal, PKF Consulting Toronto
