Intent for leisure travel is up from the prior year across most income brackets nationwide. 73% of the highest earners are planning leisure travel in the next six months, up from 64% last year while 41% of survey respondents in the lowest income bracket have plans to travel, up from 35% last year. The share of middle class travelers planning a vacation in the next six months is down slightly from the prior year.

May saw almost 19,000 more people pass through security at Anchorage's airport, a sign of outside interest in a trip to Alaska, and Alaskans own intention to see the sights as school let out for the year.

Hotel Performance Dips (Compared to a Record)

A combination of -11.7% YOY less hotel demand in May among Anchorage hotels and a +0.5% YOY increase in supply resulted in a -12.1% YOY drop in occupancy compared to last year to 70.2%. However, occupancy continues to gain month over month with May the highest occupancy achieved so far this year.

ADR decreased -1.2% YOY in May to $222.62. The combined decreases in ADR and demand caused a -12.7% YOY drop in revenue to $39.7M for the month. Although the May ADR is lower than last year, it is significantly higher than ADR for the first four months of this year with the next highest achieved in April at $159.

So if interest in travel is so high, and the airport saw more travelers, why the mixed signals in hotels? The danger lies in comparing to May of 2023. Last year, large military exercises artificially increased hotel demand in Anchorage. Adding deeper historical context helps as well. May 2024 hotel demand is still the fifth best for that month in Anchorage.

Early Summer Forecast

Advance booking data from TravelClick suggests improvements in independent hotel bookings for the coming months, with July slightly ahead of last year, and August seeing single-digit gains in advance bookings, compared to the same time last year.