In the latest forecast unveiled at the Americas Lodging Investment Summit (ALIS), CoStar and Tourism Economics have largely maintained their projections for the US hotel sector in 2025.
The anticipated increases in average daily rate (ADR) and revenue per available room (RevPAR) remain at 1.6% and 1.8%, respectively.
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Occupancy rates have been slightly adjusted upward by 0.1 percentage points, now expected to reach 63.1% for the year.
Economic indicators and industry performance
Amanda Hite, president of STR, noted that while there is a rise in business optimism, the underlying economic data has remained relatively consistent with previous forecasts.
The stronger performance observed in the fourth quarter was attributed to unique factors such as increased holiday travel and weather-related events, which are not indicative of a long-term trend.
Consequently, the overall forecast has seen minimal changes, with slight adjustments across different hotel chain scales.
Current economic conditions suggest that higher-end hotels are expected to continue leading industry performance.
Impact of the new administration
The forecast does not yet account for potential effects stemming from the new US administration, as significant policy changes have not been implemented, and their prospective impacts remain uncertain.
Analysts will continue to monitor policy developments to assess any future implications for the hotel industry.
Outlook for 2025
Looking ahead, the US hotel industry is poised for modest growth in key performance metrics.
While certain segments, particularly higher-end hotels, are expected to drive performance, the overall outlook remains cautiously optimistic, contingent on broader economic conditions and potential policy shifts.
This forecast provides stakeholders with a tempered yet positive view of the industry’s trajectory, emphasizing the importance of adaptability in navigating the evolving economic landscape.
