STR Releases Analysis of NFL Relocation Impact on Hotel Markets

NFL logo with footballs in the background - Photo by Adrian Curiel on Unsplash
STR Releases Analysis of NFL Relocation Impact on Hotel Markets

Hotels in San Diego noticed the biggest impact from the Chargers’ move to Los Angeles in 2017, and while St. Louis hotels experienced a smaller demand drop in 2016 the year after the Rams moved to LA, ADR growth kept RevPAR in the market slightly positive.

San Diego’s hotel market was the one most affected by the two NFL franchise relocations of the last two years, according to an analysis by STR’s, Consulting & Analytics team.

“Determining the relocation impact, whether it be positive or negative, on San Diego, Los Angeles and St. Louis is difficult because these are all major markets with a lot of performance variables from year to year,” said Raquel Ortiz, STR’s senior analytics manager. “However, even though we can’t attribute percentage changes strictly to the Chargers’ move to LA, we can say that the San Diego market was the most affected by NFL relocation.”

When comparing the night before and night of 2016 home regular season games with the same days in 2017, San Diego reported an 8.9% decrease in occupancy and a 7.1% drop in average daily rate (ADR). That resulted in a 15.4% decline in revenue per available room (RevPAR). When excluding the final home game of 2016, which fell on New Year’s weekend, the overall RevPAR decline year over year was 19.5%.

“What makes the San Diego analysis a bit complex is the fact that the market’s weekend was in general down in 2017,” Ortiz said. “The average RevPAR for all weekends in 2016 was $131, but that dropped to $127 this past year.”

Market Comparison Years Demand Occupancy ADR RevPAR
San Diego 2017 vs. 2016 -11.1% -12.0% -8.5% -19.5%
Los Angeles 2017 vs. 2016 +4.4% +0.8% +4.6% +5.5%
St. Louis 2016 vs. 2015 -2.1% -1.1% +1.3% +0.2%
Los Angeles 2016 vs. 2015 +5.1% +4.4% +11.5 +16.4%

Source: STR; comparison dates include night before and night of home regular season game; Los Angeles includes select submarkets only

Using the same type of comparison for 2015 and 2016, St. Louis actually showed a 0.2% increase in RevPAR the year after the Rams were moved to Los Angeles. Occupancy fell 1.1% from home game days in 2015, but ADR was up 1.3%. Additionally, average weekend RevPAR for the full year went from $85 in 2015 to $87 in 2016.

Los Angeles, the city to welcome both the Rams and Chargers, is by far the largest of the three hotel markets included in the analysis. Therefore, STR examined the first season of relocation in only the five submarkets including and surrounding both the Stub Hub Center and the Los Angeles Memorial Coliseum.

Around Chargers home regular season games in 2017, the five LA submarkets saw a 5.5% increase in RevPAR from 2016, mostly due to a 4.6% lift in ADR. Around Rams home regular season games in 2016, the RevPAR jump was 16.4%, again mostly pushed by ADR (+11.5%). When comparing Rams home games in 2017 versus 2016, the RevPAR increase was significantly less than the team’s first year at the Coliseum (+5.5%).

“The next move is the Raiders from Oakland to Las Vegas in 2020, and many believe each of those markets will see a significant impact from the relocation,” Ortiz said.

STR provides clients from multiple market sectors with premium, global data benchmarking, analytics and marketplace insights. Founded in 1985, STR maintains a presence in 10 countries around the world with a corporate North American headquarters in Hendersonville, Tennessee, and an international headquarters in London, England. For more information, please visit str.com.