The Cayman Islands Has the Caribbean’s Hottest Hotel Sector
By Rico Louw
Is the Cayman Islands the hottest hotel market in the Caribbean?
The Cayman Islands experienced the largest rises in the Caribbean in each of the three key performance metrics in 2018, according to data from islands where STR maintains a sufficient reporting sample.
The Cayman Islands saw a 6.4 percent increase in hotel occupancy, a 14.6 percent increase in average daily rates and a 22 percent increase in revenue per available room, according to the STR data.
That was followed by Aruba, the only other destination to show a double-digit jump in RevPar, and Curacao, which saw the third largest lift in ADR, at 8.5 percent.
Puerto Rico experienced a decline in occupancy (-2.5%), but a 7.2% rise in ADR.
The data came as the Caribbean hotel industry ended 2018 on a positive note as December performance increases pushed total-year numbers to solid levels when considering the region’s recovery status.
In year-over-year comparisons with December 2017, revenue per available room (RevPAR) in the Caribbean overall rose 5.4%, due to a 3.6% lift in average daily rate (ADR) and a 1.7% increase in occupancy. Demand growth (+3.9%) outpaced supply (+2.2%) for the month, relieving some of the pressure we’d seen on occupancy levels and further solidifying hotelier pricing confidence.
When looking at total-year data for 2018, Caribbean hotel occupancy fell 1.1%, but a 1.7% increase in ADR pushed RevPAR growth of 0.6%. Demand and supply were both down, -1.2% and -0.1%, respectively. While 2018 performance was mixed, the results were strong compared with other markets that have experienced a recovery period after a natural disaster.
When looking at other islands’ performance during 2018, Aruba experienced an absolute occupancy level of 75.2%, the highest among the islands, and an ADR level of US$318. Curaçao reached a 71.4% occupancy level and an ADR of US$156, while Barbados posted an occupancy level of 67.1% and an ADR level of US$287.
Investment in the region looks to be strong moving forward. As of December 2018, the Caribbean had 44 hotels in construction accounting for 11,760 rooms. Supply is projected to grow 3.9% in 2019, according to STR’s latest Caribbean forecast.
Additional questions regarding hotel data reporting in the Caribbean can be directed Rico Louw at email@example.com.