Hotel Industry in Mexico Reports Mixed Results for Q1 2018

Rendering of the Caesars Palace Luxury Resort Coming to Puerto Los Cabos, Baja, Mexico
Caesars Palace Luxury Resort Coming to Puerto Los Cabos, Baja, Mexico

Hotels in Mexico reported a 0.6% increase in occupancy to 65%, a 5% decrease in ADR to 2,568.88 Mexican pesos ($136.66) and a 4.4% decline in RevPAR to 1,668.87 Mexican pesos ($88.78).

Mexico’s hotel industry reported mixed year-over-year results in the three key performance metrics during the first quarter of 2018, according to data from STR.

Compared with Q1 2017:

  • Occupancy: +0.6% to 65.0%
  • Average daily rate (ADR): -5.0% to MXN2,568.88
  • Revenue per available room (RevPAR): -4.4% to MXN1,668.87

“Travel warnings were issued by the U.S. State Department within the last year, most recently in March, which cautioned against traveling to popular destinations in Mexico,” said Fatima Thompson, STR’s associate director of business development, hotels. “This travel advisory is reflected in the mixed hotel results during the first quarter of 2018.”

Among key STR-defined markets in the country, Northeast Mexico reported the largest increases in occupancy (+8.9% to 63.5%) and RevPAR (+9.9% to MXN806.48). The market posted the only lift in ADR (+0.9% to MXN1,269.08).

Northwest Mexico experienced the second-largest rise in occupancy (+4.5% to 63.3%), resulting in the only other increase in RevPAR (+0.2% to MXN1,841.67).

Mexico Central North registered the only other increase in occupancy (+2.5% to 64.3%).

Mexico City reported the largest decline in RevPAR (-7.6% to MXN1,691.42), due primarily to the largest drop in ADR (-6.3% to MXN2,479.44).

Mexico Central South experienced the steepest decline in occupancy (-4.5% to 51.5%) and the second-largest decrease in RevPAR (-5.9% to MXN567.80).

Among segments, the Economy class posted the largest increase in occupancy (+6.1% to 60.3%).

The Midscale class reported the largest increases in ADR (+3.3% to MXN1,022.17) and RevPAR (+7.1% to MXN630.42).

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