Baird/STR Stock Index Up 6.4 Percent for January 2018
The Baird/STR Hotel Stock Index outperformed the S&P 500 and the MSCI REIT (RMZ) during January.
After more than five years of relative stability, new factors are at play in the hotel investment market that will affect hotel capitalization rates and values in a changing economic landscape.
The following is an overview of a six-month financial leadership project that I recently completed at a full-service hotel. The project consisted of six half-day hospitality financial leadership workshops delivered in-house and monthly 1-1 leadership coaching appointments with the 15 managers assigned to the program.
Within the lodging industry, there are other metrics that have historically been reliable indicators to measure the potential for hotel profit growth. One is the change in rooms revenue, or RevPAR. Using data from our annual Trends® in the Hotel Industry, we find an 86 percent correlation between annual changes in RevPAR and Gross Operating Profit (GOP) from 1960 to 2016. This implies that changes in RevPAR do provide a very strong indication of changes in GOP.
We have all heard of the 80/20 rule. But I am willing to bet most of you have not heard it in conjunction with the words 'food cost.' A good friend of mine who was an executive chef explained it to me and I am going to share it with you.