After two weeks of significant declines, it was a mostly flat week for the U.S. hotel industry with revenue per available room down 0.8% for the week of July 20-26. Demand improved marginally, but with a 0.9% increase in room supply, occupancy was down 0.2 percentage points. Occupancy has consistently declined faster than average daily rate this summer. ADR was flat (-0.1%), marking a four-week stretch of stalled rate growth for the country.
A notable comparison in the most recent week was to last year’s CrowdStrike tech outage – which occurred on Friday, July 19, 2024, and lifted hotel performance over the weekend and into the early part of the following week. This year, Sunday showed a significant RevPAR decline (-4.7%) followed by a smaller drop on Monday (-2.1%), the result of the comp to last year. Midweek performance was soft, reflecting sluggish business demand, while weekend RevPAR improved 1.7%, buoyed by leisure travel.
Two markets pulled down the top 25 RevPAR comp
The top 25 U.S. hotel markets saw a greater weekly RevPAR decline (-1.7%) compared to the rest of the country, which posted basically flat RevPAR (-0.2%). Two markets pulled down the top 25 comp.
- Houston experienced a 25.9% RevPAR decrease due to a difficult comparison to last year when displacement demand was elevated by the Derecho storms/outages and Hurricane Beryl.
- Los Angeles, with lower ADR and occupancy, saw a RevPAR decline of 10.5%. In particular, the Los Angeles central business district was down 29.5%, affected by heightened tensions in the market. Both group and transient demand declined.
Excluding Houston and L.A., top 25 market RevPAR was flat (0%) with occupancy down 0.8 percentage points and ADR up 1%.
Las Vegas had a better week
Las Vegas, which had reported negative hotel RevPAR comps for 12 straight weeks, posted a 6.2% increase. The increase was entirely ADR-driven (+7.9%) while occupancy retreated 1.2 percentage points. Rate growth was lopsided with the weekend up and weekdays down.
Weekend hotel RevPAR (+42.7%) was lifted by numerous concerts, most notably Beyonce’s Cowboy Carter concert at Allegiant Stadium. There were several other well-attended concerts hosted on the weekend, including the Backstreet Boys and internationally renowned EDM artists.
Weekday RevPAR dropped 13.5% due to conference calendar shifts and the comparison to last year’s tech outage early in the week.
Most top 25 markets improved from their four-week average
Most top 25 U.S. hotel markets saw RevPAR improve from their recent four-week averages. Growth markets for the week ending July 26 included Chicago (+10.9%) and St. Louis (+9.1%). Both markets showed strong weekday and weekend performance.
Orlando, Anaheim (Orange County) and New York City rounded out the markets with RevPAR gains above 5%.
Markets that have experienced a challenging four weeks include New Orleans, Boston and San Diego, which all posted RevPAR declines each week. New Orleans has shown persistent decreases through most of the summer season. While admittedly out of its “high season,” NOLA remains a market to monitor as the U.S. moves into fall’s convention season. Washington, D.C. has seen RevPAR declines over the past three weeks with the latest decline in double digits (-12.5%).
Luxury unstoppable even on weekdays
Luxury hotels led all other chain scales and were the only segment to show RevPAR growth (+1.9%) for the week. In contrast, economy hotels had the sharpest decline at 4.4%. The day-of-week split further reveals the strength of luxury hotels. While weekday RevPAR across the other five chains scales declined, luxury held positive.
Weekend RevPAR growth was notably higher for luxury chains followed at a distant second by upper-upscale hotels.
Hotel demand increased across all chain scales except economy. However, supply growth has largely been outpacing demand and presents a challenge to maintain occupancy, particularly among upper midscale and higher chains.
What US hoteliers can expect
As we near the end of July, many U.S. school districts are already preparing for the start of the fall term, so it is expected that family travel will slow or be more reliant on shorter vacations. U.S. hotel demand/occupancy will start to decrease in August through September’s Labor Day holiday week. Leisure-oriented weekends should continue to have a small advantage over more business-oriented weekdays for the remainder of summer. Recent consumer sentiment surveys indicate that travelers’ perceptions and travel plans have both improved. This is perhaps seen as a vast opportunity for the U.S. hotel industry as there are still millions of potential travelers who have either already planned or are open to scheduling new trips/hotel stays through the remaining warm weeks of summer.
Global RevPAR growth slowed as occupancy hit the highest level of 2025
Excluding the U.S., global hotel RevPAR declined 1.5%, the result of decreases in occupancy (-0.5 percentage points) and ADR (-0.8%). These next few weeks represent peak travel season, and occupancy at 73.4% was the highest level of the year thus far. Peak global hotel occupancy is expected in two weeks. It is notable that occupancy has consistently declined each of the past five weeks. ADR comps have remained positive for most of the year with negative readings only four times. However, three of those negative readings have occurred in the past seven weeks — an indication that hotel pricing power across the globe is slowing.
Japan, Canada, Spain and Indonesia have placed in the top four RevPAR growth positions across the key countries for the past two weeks. Japan and Indonesia’s strong hotel performance is fueled entirely by ADR while RevPAR gains in Canada and Spain benefit from modest occupancy gains while most of the lift also comes from ADR.
Top-performing hotel markets across the globe are in the same four countries as recent weeks. The majority of markets in Canada and Spain experienced RevPAR gains. All markets in Japan posted gains. Half of the markets in Indonesia advanced RevPAR.
In the United Kingdom, two markets stood out with better than 30% RevPAR gains – Aberdeen, hosting the Tall Ships Races, and Manchester, lifted by the last night of the Oasis tour and the five-day England vs. India Test cricket match.
France (Summer Olympics) and Germany (UEFA Euro 2024) have experienced declines over the past four weeks due to the major event calendar shifts from last year.
China’s RevPAR declined 5.1%. Among the four top-tier cities, Beijing and Guangzhou saw the greatest declines as they have over the past three weeks. Shanghai and Shenzhen posted flat RevPAR.
Globally, the summer season will continue a bit longer with the peak expected in two weeks. Thereafter, travel will slow until conference season picks up in mid-September. The recent RevPAR slowdown was expected. The magnitude of the slowdown will become more evident as we move into the last quarter to 2025.
Chris Klauda is director of market insights at STR. M. Brian Riley is a senior analyst at STR.
This article represents an interpretation of data collected by CoStar's hospitality analytics firm, STR. Please feel free to contact an editor with any questions or concerns. For more analysis of STR data, visit the data insights blog on STR.com.