Market Trends

📈 U.S. luxury hotel development costs exceed $1 million per room, with average daily rates at $398. Higher interest and operating costs hinder new projects. Marriott's 69% of luxury developments mix residential and hotel spaces, like W Pompano Beach, slated for 2027. Four Seasons plans 180 properties by 2033. Global luxury hotel openings increased from 140 in 2024 to 255 in 2025, particularly in Asia. Conversion projects are favored for cost efficiency.

📈 Arlington, Virginia—2025-26 U.S. hotel growth projections from CoStar and Tourism Economics were downgraded at the 17th Annual Hotel Data Conference. For 2025, demand is down 0.6%, ADR by 0.5%, and RevPAR by 1.1%. In 2026, demand drops by 0.5%, ADR by 0.3%, and RevPAR by 0.7%. GOP margins are cut by 0.3 percentage points for 2025 and 2.3 points for 2026 due to higher F&B costs. Economic recovery is expected post-trade talks.

📊 French hotel industry showed a 1.9% increase in RevPAR in early summer 2025, driven by a 3.4-point rise in occupancy rates, though average daily rates fell by 2.8%. Paris and the French Riviera excelled with a 10-point higher occupancy than the national average, aided by high-end international demand. Notably, the Channel and Brittany coasts saw RevPAR growth of 14.9% and 10.3%, respectively. Climate change propelled the "coolcation" trend, enhancing mountain and rural tourism, with Normandy leading RevPAR growth at 14.9%.

📈 July 27-August 2, 2025, Arlington, Virginia—U.S. hotel industry reports mixed performance: occupancy at 69.5% (down 0.1%), ADR at $161.00 (up 0.5%), and RevPAR at $111.90 (up 0.4%). San Francisco leads with occupancy up 15.5% to 81.7%, ADR up 15.4% to $218.91, and RevPAR up 33.2% to $178.74, boosted by World Transplant Congress. Houston sees declines: occupancy down 19.3% to 61.2% and RevPAR down 25.3% to $69.99 due to Hurricane Beryl aftermath.

🏠 Global experiences market to hit $3.1 trillion by 2025. Tourist spending contributes $1.3 trillion, but only 25% structured and paid. Infrastructure lags as 60% of travelers plan around live events. Gen Z spends twice as much as Boomers, prioritizing online booking and shareability. Event-led discovery platforms are key. ROCH Ventures sees this as a demand shift, not just a category. Sources: McKinsey, Skift (Sept 2024), American Express Global Business Travel Trends (2025).

📍 Culture Discovery Vacations, founded in 2006, revolutionizes luxury travel by offering authentic experiences in small-town Italy, focusing on intimacy over amenities. Guests (some paying $2,000/night elsewhere) partake in activities like truffle hunting and cooking with local families. Post-pandemic, there’s a spike in travelers seeking meaningful over material experiences. With over 30 referrals from one guest, this approach yields high retention. Michael Kovnick, CEO, highlights opportunities for travel professionals to embrace this anti-luxury trend.

📅 UK hotels, August Bank Holiday 2025: Forward bookings up 6% year-on-year, ADR increases 2.5% to £239.20. Booking lead times rise 8.19% to 130.1 days. Glasgow sees 22.7% booking growth, ADR up 10.3% to £201.78. London bookings grow 14.5%, ADR up 6.38% to £251.85. Edinburgh bookings increase 10.7%, ADR grows 1.74% to £412.16. 65% of bookings from abroad; 69% of UK consumer bookings at UK properties. Data from SiteMinder, period 20–26 August 2025.

🛫 Luxury travel is seeing a shift. Aspirational travelers, with net worths between $100k–$1M, make up 35% of global luxury travel spend. They're driving demand for high-end experiences, but are economically vulnerable and may not return. Upscale airlines, Airbnb, and hotel developers are adapting to this trend. Brands must balance premium pricing with lasting emotional loyalty, focusing on reliability over opulence. The Connaught Bar in London exemplifies this, thriving on consistent service rather than transient trends.

🌡 In 2024, July was the hottest month globally, confirmed by the World Meteorological Organisation. By 2025, regions like Andalusia saw temperatures over 45°C, impacting tourism. Seville's bookings dropped 18% in July 2025 with daily temperatures above 43°C. Fire evacuations affected areas like Aquitaine (2023) and Rhodes Island (2023). The "coolcation" trend rises, favoring cooler climates like the French Alps and Canada. Tourism adapts with improved facilities and season shifts, emphasizing cooler, less crowded destinations.