CoStar and Tourism Economics further downgraded performance projections in the final U.S. hotel forecast revision of 2025.
For 2025, occupancy was lowered 0.2 percentage points to 62.3%, while average daily rate (ADR) was maintained at +0.8% for the year. Revenue per available room (RevPAR) was downgraded 0.3 ppts to -0.4%. The last total-year RevPAR declines in the U.S. occurred in 2020 and 2009.
Similar adjustments were made for 2026: occupancy (-0.3 ppts), ADR (-0.1 ppts) and RevPAR (-0.3 ppts).
We expect little change in the macroeconomic environment as unemployment and prices continue to rise. As a result, our hotel performance outlook for the remainder of this year and next were lowered once again. ADR is growing well below the rate of inflation, which in turn will put more pressure on margins. Amanda Hite, STR president
Job market softening, policy uncertainty, and tariff costs remain near-term drags for consumers. However, heading into 2026, we expect the U.S. travel economy to firm up moderately. Household income growth will continue, accompanied by tax cut benefits, resumed hiring, and less policy instability. Expanding global long-haul travel and World Cup interest will bring improved international visitation. Aran Ryan, director of industry studies with Tourism Economics
GOPPAR projections have been lowered from our previous forecast, with the decrease in 2025 being mainly due to higher expenses, especially in the F&B department, as well as increased costs in other operated departments, marketing, and utilities,” said Hite. “Labor costs will be slightly higher in 2025, likely due to the increase in the aforementioned F&B department, which is traditionally more labor-intensive.
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