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Book it: Hotel industry on a roll

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  • | 10:00 a.m. March 20, 2015
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Profit levels of hotels and motels nationwide nearly tripled in 2014 over 2013, according to a new report.

The report, from Raleigh, N.C. based financial data firm Sageworks, says net profit margins for privately held hotels and motels increased from 5.7% in 2013 to 14.6% last year. Sales growth combined with controlled operating expenses led to the surge, the report adds. It's the fifth straight year of growth, and the strongest profitability level in a decade. “We are seeing good solid sales growth into 2015, and don't expect a change in the trend in the near term,” Sageworks analyst James Noe says in a statement.

Another side of the profit increases, Noe points out, is room supply levels haven't increased with demand, so the industry has pricing leverage. That provides a boost to average daily rates.


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