Uncertainty has been one of the themes of 2025 for the U.S. hotel industry, but hoteliers are becoming more certain that the recovery may have finally stalled.
The slowing of U.S. hotel demand has persisted from early tough 2024 comparisons and calendar shifts to declines even in busier summer months. Weekday demand — a proxy for U.S. business travel — has stayed weak, and international travelers still haven't come to the U.S. at the rate Americans are traveling overseas.
With those demand factors at play, CoStar and Tourism Economics presented the latest update to the U.S. hotel forecast for full-year 2025 and 2026, cutting projections for the industry's key performance indicators.
Read on for some more takeaways from the first day of the Hotel Data Conference.
Podcast recap of Day 1
Photos of the day
Slide of the day
CoStar and Tourism Economics released an updated U.S. hotel forecast during the opening session of the Hotel Data Conference. Demand, average daily rate and revenue per available room projections were lowered for full-year 2025 and 2026.
Quotes of the day
"I'm sorry to say, we've seen the best this year. The second half of the year is going to be tough. The next six months are really going to be rocky and probably not feel so great, because we saw the bulk of our growth in the first half of the year, unless you're a luxury hotel."
— Amanda Hite, president of STR
"Right now we're in a bit of a rough patch. As you may have heard, the jobs numbers were lower than expected — not only for this past month, but for the last three months with revisions, averaging only 35,000 jobs per month. But in context, this is the weakest job growth that we've had since the pandemic. And, if it were not for the health and social services sectors, employment would have declined over the last three months."
— Adam Sacks, president of Tourism Economics
"The training and onboarding, the resources just aren't there. We're finding companies are looking for plug and play. It's like, 'We want someone who's done this job, like [with] one of our competitors, come in and they'll know what to do.' And that's hard, sometimes that doesn't exist. Or most people, especially right now, they're not raising their hand. They don't want to engage in a search. They're generally happy with where they are in a stagnant job market, so why take the risk?"
— Terry Donovan, executive vice president of AETHOS Consulting Group, on the challenges hotel companies are facing to hire for open positions.
“You have to have something that assists you along the way. In the old days, I had an executive assistant. Today, I've got ChatGPT. … But the most important thing, and we talked about this, is that you've got to make sure that you maintain your critical thinking.”
— Lori Kiel, senior vice president of revenue management, at Pyramid Global Hospitality, on finding ways to use artificial intelligence to help with workflow.
Editors' takeaways
My first Hotel Data Conference is shaping up to be a memorable one. I won't be forgetting the collective gasp from the audience when STR President Amanda Hite unveiled a lower 2025 outlook for full-year revenue per available room growth. U.S. hotel RevPAR is projected to dip 0.1% in 2025, a sharp turn from the original prediction of 1.8% growth made in January and even compared to the midyear revision to 1%. Projections were adjusted for other key hotel metrics, too.
The rest of the data presented in this morning's "First take" session with Hite, Tourism Economics' Adam Sacks and CoStar's Jan Freitag had a lot of information on where the hospitality industry is at and where it's headed for the rest of the year. I see an evolution from the "wait and see" mode we were in earlier this year to more of an understanding of how some bigger macroeconomic factors have hit the travel industry — with more effects to come.
Another evolution in this conference's conversation is how the hospitality industry is thinking about artificial intelligence. Hoteliers — whether they know it or not — are in a race to "win" AI. They need to get their ducks in a row for the ongoing AI revolution, and hotel companies do not have the luxury of endless capital resources to play around with the technology. So, all eyes are on who is going to optimize AI first — from figuring out how to rework their websites to account for GEO, or generative engine optimization, to repositioning marketing to use AI to work smarter and not harder.
— Natalie Harms, reporter
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The post-pandemic recovery is officially over and the next U.S. economic and lodging cycle has begun. That was quite a statement during the first day of the 2025 Hotel Data Conference.
I'm quickly coming up on 10 years covering the hospitality industry later this year. Early on in my introduction to this business, the refrain from hotel executives and analysts was "Things are good, but how long will the cycle last?" or more recently "When do we get back to the highs of 2019, pre-pandemic?"
During a presentation titled "Occupancy: Stabilizing or still catching up?" STR Senior Director of Analytics Isaac Collazo compared the occupancy recoveries in the years after the Great Recession and in the years following the COVID-19 pandemic. In short, U.S. hotels took longer to recover demand after the recession and average daily rate was slower to recover; after the pandemic, hotel rates jumped right away to capitalize on consumers taking revenge travel trips and being less price-sensitive. But now, U.S. hotel demand looks like it's flattened more quickly post-pandemic than post-recession, when it grew more gradually.
Another one of Collazo's takeaways was that the strong hotel performance in the immediate years pre-pandemic may have been the outlier and not the "normal" levels U.S. hoteliers should be striving to reach again as soon as possible. Of course, that's a tough pill to swallow especially as business expenses keep mounting and now consumers seem to be tightening their wallets and taking fewer trips.
— Dan Kubacki, senior editor
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International inbound travel to the U.S. got a lot of mentions today, most notably in the general session with Tourism Economics’ Adam Sacks referencing the downward trend in this travel while explaining the downgraded forecast.
His colleague, Aran Ryan, echoed this during a later session, remarking that negative headlines and sentiment toward the U.S. is affecting travel numbers more than any direct cause from the Trump administration’s policies. The number of U.S. inbound arrivals was projected to recover to 2019 levels in either 2025 or 2026; the hope is now that happens by 2029 — pending further hits to U.S. sentiment.
Both Sacks and Ryan made it clear that the numbers will likely start to look better next year, but the word “uncertainty” is back in headlines — not to pandemic levels, but it’s back in vogue.
— Trevor Simpson, associate editor
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