U.S. hotel industry growth slows in Q2
Hotel fundamentals softened in Q2, largely due to a 1.5% year-over-year drop in occupancy
The average daily rate (ADR) increased by 2.6% year-over-year, its slowest annual growth since Q1 2021. Revenue per available room (RevPAR) increased by just 1.1% year-over-year, a material slowdown from Q1's 15.9% pace.
Key takeaways
- Total inbound foreign visitors were 27% below pre-pandemic 2019 levels, while the number of Americans traveling to Europe and the Caribbean increased by 5% and 8%, respectively;
- Leisure markets remained the strongest RevPAR performers relative to 2019; however, Q2 RevPAR declined from last year in several of them, including West Palm Beach, Savannah, Phoenix and St. Petersburg;
- Occupancy rates for all location types were below 2019 levels in Q2. Urban locations were the only category to post year-over-year gains, with the other five location types contracting vs Q2 2022.
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