Sam Spade's San Francisco

According to San Francisco Business Times the hotel business in San Francisco is improving according to two standard benchmarks. The occupancy rate is up and the average daily room rate is up -- more guests paying higher rates.

Here's the report from :

In May 2010, San Francisco hotels saw their average daily room rates climb for the first time in 17 months.

A San Francisco hotel room cost an average of $158.42 in May 2010, a 3.8 percent increase over the $152.68 the average hotel charged in May 2009, according to a new report from PKF Consulting.

Hotel occupancy in the city climbed to 82.5 percent for the month, a 10.4 percent increase over May 2009 occupancy of 74.7.

San Francisco hotel occupancy has remained pretty strong throughout the recession, but its rates have plummeted, which has caused so much strain at hotels around town. While this rate gain by no means begins to recover lost ground — hotel rooms averaged $190.46 in May 2008 — it is the first real sign that hotel rates might indeed grow for the full year.

For the first five months of this year, hotel rates in San Francisco averaged $149.21, a 4.4 drop from the $156.08 average hotels were able to charge in the first five months of 2009. Citywide room rates were their lowest in December 2009, when they averaged just $132.81 a night.

Photo credit: Although San Francisco has a long history of wild rides in the City's many hotels, the sign in this photo was from the Palace Hotel in Norfolk, Virginia. Courtesy of Northeast Auctions.