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PwC downgrades 2025 U.S. hotel forecast

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  • 12 June 2025
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This article was written by Hospitality Today. Click here to read the original article

Second-quarter slowdown and macroeconomic headwinds weigh on RevPAR outlook, with modest recovery expected in the second half of the year

Jun 12, 2025

Consulting firm PwC has revised its 2025 U.S. hotel performance forecast downward, citing economic uncertainty, geopolitical tensions, and a soft second quarter. While inbound international business travel remains a bright spot, domestic demand appears uneven. PwC’s May 2025 Hospitality Directions report reflects a more cautious industry outlook, echoing recent forecast downgrades from other analysts like STR, CBRE, and LARC.

Key takeaways

  • Lowered forecast for RevPAR: PwC now expects U.S. RevPAR (revenue per available room) in 2025 to rise by just 0.9% to $101.16, down from its previous forecast of 1.5% growth.
  • Muted occupancy growth: Projected occupancy is 63.1%, up just 0.1 percentage points from 2024—unchanged from November’s forecast.
  • ADR (Average Daily Rate): Expected to increase 0.8% to $160.30, down from a 1.3% gain previously projected.
  • Second-quarter slowdown: PwC reports a 1.2% year-over-year decline in Q2 RevPAR, citing “significant deceleration” in travel demand.
  • Stronger H2 outlook: RevPAR is forecast to rebound with 1.1% growth in Q3 and 1.8% in Q4 as economic conditions stabilize.
  • Mixed domestic corporate travel: Business travel within the U.S. shows stable demand in premium segments and group bookings, but weakness in budget categories.
  • International travel resilient: Inbound international business travel continues to demonstrate strong performance.
  • Wider industry trend: Other forecasters (STR, LARC, CBRE) have similarly downgraded 2025 outlooks, reflecting broader economic uncertainty.

Get the full report at PwC

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