Short-term rentals of larger units weathered the COVID-19 pandemic better than hotels and smaller short-term rental units, according to a joint analysis by STR and AirDNA.
With an occupancy rate of 61.4 percent, large short-term rentals were doing well during quarantine, while short-term rentals came in at 58.2 percent occupancy. Hotels fared the worst, with only 39.2 percent occupancy.
US hotel gross operating profit declined 105.4 percent in June, according to STR's monthly P&L data. However, this showed improvement from April's low numbers of a decline of 116.9 percent and a decline of 110.1 percent in May.
The profitability was calculated using data of total revenue per available room, gross operating profit per available room, total labor costs per available room, and earnings before interest, income tax, depreciation and amortization.
The hotel industry showed more signs of recovery with some hotels breaking even on profits with 50 percent occupancy. Markets that were shown to be doing better were Tampa and St. Petersburg in Florida, and Anaheim and Santa Ana in California, with Dallas, Texas in a distant third. Overall, regional areas tended to fare better than dense, urban areas.
Earlier in 2020, the hotel industry had seen slight gains prior to the quarantine orders across the country. The dropoff starting in March was steep and continued to its lowest declines in May, with June showing a slight reprieve from further decline, according to STR.
Among the various types of hotel properties, those at opposite ends of the spectrum have rebounded the fastest. Luxury hotels profits and economy hotels were close in range, whereas resort properties and small town hotels were also recording similar improvements.
STR provides data, analytics and market insights for global hospitality sectors and is headquartered in Tennessee, London and Singapore. AirDNA provides data on short-term rentals and forecasts potential revenue of upwards of 10 million vacation rentals yearly.
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