Volatility of hotel market fundamentals and the determinants of variations between markets
Name
707727966-MIT.pdf
Description
Full printable version
Size
2.38 MB
Format
Adobe PDF
Checksum (MD5)
626723c3bc01bc508a48b80429b68012
Author(s)
Cason, Brian (Brian Paul)
Advisor(s)
William C. Wheaton.
Date Issued
2010
Publisher
Massachusetts Institute of Technology
Abstract
How can volatility as well as other dynamics and characteristics in hotel market fundamentals affecting risk be better understood? This paper explores that fundamental question along with other more specific questions that naturally follow: What are the markets and hotel sectors that exhibit the most volatility in RevPAR, and its various components: occupancy, ADR, absorption and completions? How can markets be characterized as more supply driven or demand driven? How can market revenue metrics be characterized as rate or occupancy driven? What determines the variations in these metrics? What markets behave similarly? What do these findings mean in terms of various risk management practices? This paper develops a model for the systematic analysis of hotel markets based on observed trends in historical data. The paper first calculates measures of volatility. It then develops a model to characterize markets based on which fundamentals play a larger role in hotel market dynamics. It then provides a further comparison of markets based on which exhibit similar movements in RevPAR. The findings then are analyzed for their meaning in terms of risk in hotel markets. Finally, the findings are interpreted to reach conclusions about the nature and determinants of volatility in hotel markets, and how to better mitigate these risks in portfolio selection.
Description
Thesis (S.M. in Real Estate Development)--Massachusetts Institute of Technology, Program in Real Estate Development in Conjunction with the Center for Real Estate , 2010.
Cataloged from PDF version of thesis.
Includes bibliographical references (p. 79-80).
Subjects
Center for Real Estate. Program in Real Estate Development.
MIT Department
Massachusetts Institute of Technology. Center for Real Estate. Program in Real Estate Development.
Massachusetts Institute of Technology. Center for Real Estate
Terms of Use
M.I.T. theses are protected by
copyright. They may be viewed from this source for any purpose, but
reproduction or distribution in any format is prohibited without written
permission. See provided URL for inquiries about permission.
copyright. They may be viewed from this source for any purpose, but
reproduction or distribution in any format is prohibited without written
permission. See provided URL for inquiries about permission.
Persistent DSpace Link
