Business & Real Estate

Another strong year shaping up for Sacramento-area motels, hotels

The Sacramento area’s motel and hotel operators are well on their way to another strong year in 2016, according to the latest report released by CBRE Hotels in San Francisco.

The average daily room rate for Sacramento-area hotels in April was $119.57, up 5.4 percent from $113.44 in April last year and the highest in at least a decade, according to records.

Catherine Bolstad, a CBRE director who previously has cited an improving economy and relatively high employment for boosting Golden State lodgings numbers, said: “That is a high rate for Sacramento. … The year is going well so far.”

Local motel and hotel operators filled rooms at a brisk rate in April, which historically lags behind the prime summertime vacation months.

CBRE said the average occupancy rate of area hotels in April was 78.7 percent, up slightly from 78.6 percent in April 2015. The area’s average occupancy rate for all of 2015 was a robust 74.2 percent.

Hotel industry analysts say 70 percent occupancy is considered the point at which hotels can comfortably raise rates.

For perspective, in the sluggish post-recession recovery period in 2010, average occupancy rates at area lodgings hovered below 65 percent.

Average revenue per available room locally in April this year was $94.08, up nearly 6 percent from $89.12 in the year-ago period.

This year, travel experts with AAA Northern California and other organizations said relatively low gas prices and more disposable income among consumers are helping produce the highest volume of travelers in California and nationwide since the recession.

CBRE said San Francisco led Northern California in motel/hotel occupancy in April, with an 87 percent rate. Motels and hotels in the Monterey-Carmel resort region led in average revenue per available room, at $246.44.

Mark Glover: 916-321-1184, @markhglover