Caribbean Hotels Profitable in 2005; Region Attracts New Development

In its first-ever report on the Caribbean hotel industry, PKF Hospitality Research finds that Caribbean hotels continue to be profitable for owners and operators due to increasing rates of travel to the region spurred by a strong U.S. economy. In 2005, Caribbean hotels averaged $111,414 per available room (PAR) and $25,541 PAR in profits. The net result was a 22.9 percent profit margin. These observations come from the recently released 2006 edition of Caribbean Trends in the Hotel Industry published by PKF Hospitality Research (PKF-HR), an affiliate of PKF Consulting. A substantial portion of this profitability can be credited to the tremendous growth in Caribbean travel. Over a three-year period, from 2003 through 2005, the number of visitors to the Caribbean has grown by a total of 19 percent. The 2006 Caribbean Trends in the Hotel Industry report marks the first annual review of Caribbean hotel operations conducted by PKF-HR. This year's sample draws upon year-end financial statements received from hotels all across the Caribbean. Of the total source of revenue for the sample of Caribbean hotels chosen for the study, 51.4 percent comes from rooms, 18.7 percent represents food sales, 8.1 percent is beverages sold, telecommunications factors in only one percent while rentals and other income bring in 2.1. The rest of the revenue (18.7) comes from other operated departments.

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