May: +20 bps. of GOP margin growth on approx. +1% RevPAR & +1.5% Total RevPAR
In our monthly analysis of operational level P&L metrics of hundreds of U.S. upper-tier full service hotels (data source: HotStats), we continue to forecast slightly positive margins for 2018 - this is being driven by incrementally stronger transient demand above prior expectations. As evidenced by the modest RevPAR growth in May (particularly Upper Upscale), GOP margin growth continues to face headwinds.
We continue to observe rising labor costs in 2018. However, we find that efforts by hotel owners to minimize labor cost growth has had some positive effects.