Jul
30

PKF: Historic Hotels Performing Well

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Industry thumb rules state that the “useful life” of a hotel ranges from 30 to 40 years. After that the building and its equipment are either too old to renovate, or the property is no longer situated in a prime location. However, for a few hotels in the United States that are 50 years old, or more, they are just hitting the prime of their life. These “grande dames” are achieving premium occupancy and ADR levels compared to comparable youngsters.

To check up on the health of these aging facilities, PKF Hospitality Research, LLC (PKF-HR) analyzed the performance of historic luxury and upper-upscale hotels that opened prior to 1960 (e.g. Waldorf Astoria and The Greenbrier). Comparisons were made to the performance of comparable luxury and upper-upscale properties built since 1960. Only hotels that provided data for PKF-HR’s Trends® in the Hotel Industry survey each year from 2007 through 2012 (most current annual data available) were included in the study sample.

The study sample consisted of 41 historic hotels with an average age of 94.2 years, and an average size of 388 rooms. Eleven of the 41 historic properties are resorts, with the remaining urban/suburban full-service hotels. The contemporary sample averaged 22.9 years in age, and averaged 417 rooms. Fifty-six of the newer hotels were resorts, while another 282 were full-service properties.

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