Hotels near U.S. borders see declining demand as new travel policies and international advisories create uncertainty for visitors
Mar 26, 2025
U.S. hotel occupancy, after a modest February increase, declined in early March, with border regions particularly affected. This downturn is linked to new travel advisories and potential policy changes, raising concerns about a long-term “chilling effect” on international tourism and hotel demand.
Key takeaways
- Early March decline: Occupancy dropped 1.4% and 3.5% in the first two weeks of March compared to 2024.
- Border regions hit hardest: Hotels near the Canadian and Mexican borders saw demand declines of up to 4.8%, likely tied to travel policy uncertainty.
- Travel uncertainty as deterrent: Fear of stricter U.S. entry processes may shift travelers to easier destinations like Canada or the Caribbean.
- Not uniform across U.S.: While major cities show fluctuations, border markets appear directly vulnerable to policy shifts.
- Limited direct impact, but risks remain: Inbound tourism makes up a small portion of total U.S. travel, but long-term policy changes, labor shortages, and a strong dollar could pressure hotel revenues and margins.
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