Press Release
Durham, N.H., Dec. 4, 2000 – “I think we’ll continue overall in a positive vein with a little softening… as long
as we don’t have a significant flare-up in the Middle East… that scares me,” noted a senior executive responsible
for more than 200,000 hotel rooms. He certainly speaks the truth. The Lodging Executive’s Sentiment Index (LESI)
calculated for the month of November 64.3… the lowest reading since its inception six months ago. Although any
reading above 50 indicates expansion, the latest impressions of lodging executives about the level of business
activity for the lodging industry continues a downward trend for the third consecutive month.
The LESI calculation for November is lower by 7.4 index points following a 7.1 decrease to October’s calculation
from September’s calculation. One of LESI’s creators, Professor Evangelos Simos, from the University of New Hampshire’s
Economics Department and a regular contributor to the Blue Chip Economic Forecast says, “a LESI reading of 50+
marks the lodging industry as generally expanding; and below 50, the industry is generally declining while the
distance from 50 is indicative of the strength of the expansion or decline.” <![endif]>
Future components of the LESI also indicate a trend of lower readings for three successive months…from 63.3 last
month to a precipitous decline to 53.6 for this month…a scant few points above the line that indicates expansion.
The executives' sentiment about current business conditions decreased to 75.0 from the calculaition for October’s
reading of 80.0. Construction of additional rooms for November’s calculation climbed 2.4 index points to 85.7 versus
October’s calculation of 83.3, although lower than the expansion reported at a robust 91.7 for September’s Construction
Index reading. “The continued strength in construction is due to the long term pipeline of ramping-up the construction
of hotel rooms to include the replacement of obsolete products,” states Joe Durocher, Professor of Hospitality
Management at the University of New Hampshire and another of LESI’s creators.
The Rooms Reservations Index calculation for the month of November improved slightly to 64.3 as compared to 63.3
for October’s calculation. For the Rooms Reservation Index executives were asked what they expected for rooms reservations/bookings
over the next 12 months compared to the last 12 months. From a base line of 50, the distance continues to suggest
expansion for lodging business activity for the future. While executives rate general business conditions as expanding…but
only slightly…these same executives score their own rooms reservations/bookings at 64.3.
Only half (50%) of the executives rated current business conditions as good with the other fifty percent (50%)
rating current conditions as “normal.” Last month, sixty seven (67%) percent of the lodging executives rated the
current business as “good,” compared to sixty seven percent (67%) for October and seventy seven percent (77%) for
September.
Created by researchers at LodgingForecast.com, the LESI tracks on a month-to-month basis a 12-month outlook for
the lodging industry. The LESI is a nationwide poll of lodging industry executives in operations, finance and development,
and marketing who represent all segments of the lodging industry. LodgingForecast.com holds its executives’ responses
in strictest confidence; only the final summary analysis is reported, and the summary analysis encompasses upwards
of 1.2 million hotel rooms.
About the Index
Following the Purchasing Managers Index method of tracking leading indicators, the LESI satisfies the need for
real-time information for executive decision making in the lodging industry. The LESI is a leading indicator based
on opinions of lodging executives. Under development since June 1999, the LESI is a diffusion index--a convenient
summary measure showing the prevailing direction of change and the magnitude of change for the Lodging Industry.
About LodgingForecast.com
LodgingForecast.com is a division of the consulting firm evanjoeray, LLC which publishes several lodging related
indicators each month. Using proprietary forecasting models, researchers at LodgingForecast.com generate the LESI
along with the Lodging Industry Barometer (LIB) and several other indices each month.
| Indicator | Index | Direction of Business Activity |
Speed of Change in Business Activity |
| LESI | 64.3 | Expanding | Slower |
| Present Situation Index | 75.0 | Expanding | Slower |
| Expectations | 53.6 | Expanding | Much Slower |
For more information, contact:
e-mail: Info@LodgingForecast.com Voice: (603) 868-7888