Higher hotel rates drive expectations for performance improvements

Due to strong ADR growth, STR revised the 2023 U.S. hotel forecast up to 5% growth in revenue per available room

Jul 4, 2023

Higher-than-expected rate growth, normalizing demand segments and other factors drove changes in U.S. hotel performance projections for 2023.

Key takeaways

  • The luxury and upper-upscale segments were the ones driving rate, but there has since been a year-over-year decline in luxury rates;
  • Demand overall has been a little weaker than expected, with STR revising its ADR forecast up to 3.5% growth with occupancy down to 1.4%;
  • Looking at the rest of 2023, there are a handful of factors driving growth, including 3.5% ADR growth, and group demand that has come back stronger over the past several months as leisure demand has softened.

Ge the full story at HNN

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