U.S. hotels finally are in a "real growth" environment.
That's according to Isaac Collazo, STR's senior director of analytics and co-host of "Tell Me More: A Hospitality Data Podcast."
Revenue per available room grew 4.3% in February — the highest since January 2025. Occupancy jumped 2.3 percentage points. And then there was demand — the industry sold 2.7 million more hotel rooms this February than they did in February 2025.
"It's growth on growth. This is real, this is real growth," Collazo said.
All chain scales saw demand grow in February, and demand growth spread across more U.S. submarkets as well.
Still, co-host Jan Freitag, CoStar's national director of hospitality analytics, urged caution amid the positive numbers.
"I believe the data, but we are way early in this ball game," he said. "The impact of the war ... in Iran, and the impact on oil prices and then on gas prices has not yet trickled down into our data."
Freitag did point out that April 1 will mark one year since major U.S. tariff announcements, which had "huge impact" on group and corporate transient hotel demand. This will lead the industry this year into a period of so-called "easy comps," where they'll see positive performance changes year over year.
Group business trends
Collazo and Freitag also shared new analysis around group business.
In February, group demand at luxury and upper-upscale hotels (the traditional segmentation for groups) was up 2.9% — the highest growth since 2019.
That's a positive, but Collazo noted a few additional changes when he grouped hotels into clusters.
Most notably, he found that group demand this year appears to be more spread out, beyond traditional large group hotels, and into hotels outside the top 25 markets that have enough space for the given group.
Collazo's early thoughts?
"I think the smaller meetings have returned," he said. "And the big group hotels are probably already booked up ... they have been contracted, sometimes several years out."