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Vancouver hotels are Canada’s most pandemic-resilient

City boasts the highest occupancy and revenue per available room rates in the country
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Hotels are filling up across the region

Hospitality and tourism have been among the hardest hit sectors in the COVID-19 pandemic. 

Travel bans, closed borders, cancelled concerts and empty arenas have battered hotel bookings. While the pandemic’s full impact on the hotel industry has yet to be calculated, preliminary numbers are devastating. 

In March, the demand for Vancouver hotel rooms fell by 47.8% compared with the same month last year and was slightly higher than the 47.1% average decline across the country, according to a quarterly report from hospitality consultancy HVS and market data firm STR Inc. 

Toronto, Montreal and Calgary suffered a greater drop in demand than Vancouver. With a 56.4% drop in hotel bookings compared with March 2019, Montreal was hardest hit.

The occupancy rate for Vancouver hotel rooms was almost sliced in half, falling to 39.3% in March 2020 compared with 74.7% in the same month last year. Countrywide, occupancy rates fell to 31.5% in March 2020 from 60.2% in March 2019. 

Before the pandemic, Vancouver had the highest occupancy rate among major Canadian cities. While Vancouver’s occupancy rate was harder hit than the national average, the city still boasts the highest occupancy rate in the country. Ottawa is second at 34.5%.

COVID-19 is also to blame for Vancouver’s drop in revenue per available hotel room, which plunged to $65.78 in March 2020, from $130.07 in March 2019, a decline second only to Toronto. Consequently, Vancouver pulled ahead of Toronto as the city with the highest revenue per available hotel room. 

Cushioning the blow of lost hotel room demand is the fact that Vancouver has been losing hotels, unlike most other major Canadian cities, which have been adding to their hotel stock. 

Vancouver lost 0.8% of its supply in March 2020, according to HVS, and is forecast to lose more than 2% in 2020, according to Colliers International. 

When comparing 2020’s first quarter with 2019’s, the losses are less significant. Vancouver hotel room demand fell 17.2% in Q1 2020 compared with Q1 2019. Room occupancy fell considerably less. It declined to 58.3% in 2020 compared with 70.8% in 2019. The drop in average revenue per available room was also less severe, declining to $98.90 in 2020’s first quarter from $120.92 for the same period last year.