Canada -  Vancouver Airport

Overview:

In 2015, the Vancouver Airport lodging market realized a strong increase in demand at the same time that the room supply slightly decreased. Additionally, Vancouver International Airport served more than 20 million passengers in 2015, which represents a 4.9% increase over the previous year. The strong increase in lodging demand, alongside the growth of the ADR, resulted in a substantial 13.8% increase in RevPAR over the previous year.

According to the Conference Board of Canada, the economy of Metro Vancouver grew by 3.4% in 2015, and strong economic growth is projected for the region in the coming years—Metro Vancouver is expected to be the GDP growth leader among the 15 largest CMAs in Canada through to 2020. Construction activity is expected to lead the way in 2016 as the fastest-growing sector, followed by manufacturing.

In this context, the per-room value for the Vancouver Airport lodging market increased by 19.6% in 2015 over the previous year and reached $140,575. This is in line with the projection we made in the 2015 HVI report, where we forecast an 18.6% increase. The per-room value of the Vancouver Airport market is by far the highest among the Canadian airport markets tracked in the HVI.

The outlook for the Vancouver Airport market is positive. Airport passenger traffic is on the rise, and no new rooms are expected to enter the market from 2016 to 2018. In 2019, the room supply is expected to increase 1.9%, but the market should be able to absorb these new rooms and still see RevPAR growth.

The $1.8-billion expansion to Vancouver International Airport is expected to support market-wide demand growth over the next few years—a $213-million terminal expansion already opened in January 2015. In this positive operating environment, the per-room value is projected to increase a robust 19.4% in 2016 to $167,910 and then grow more moderately through 2019. The Vancouver Airport market is positioned with the third-highest value among the 19 major markets in 2019, which is notable for an airport market given that urban markets typically have higher land costs and performance levels.

Valuation Trends and Predictions:

Vancouver Airport Canada
Previous Year +19% (3 of 19) +9% (12 of 19)
Growth in 2017 +7% (6 of 19) +5% (12 of 19)
Growth in next 3 years +14% (6 of 19) +8% (15 of 19)

Change In Value For Market:

Vancouver Airport RevPAR % Change

For more information, please contact:

Carrie Russell, AACI, MAI, RIBC, ISHC
CRussell@hvs.com
  • +1 604 988-9743 (w)