Hotel RevPAR Growth Remained Positive Despite Economic & Geopolitical Uncertainty

Executive Summary

• The overall hotel occupancy rate increased by 0.4% year-over-year in Q1 as demand growth of 1.0% outpaced supply growth of 0.6%.
• A 1.9% increase in average daily rate (ADR), coupled with the slight increase in occupancy, led to a 2.2% increase in revenue per available room (RevPAR). Increased business travel in Q1 due to Easter falling in Q2 this year was partially offset by an 11.6% decline in inbound international travelers in March.
• Demand for lodging alternatives grew at a faster rate than that for traditional hotels. Short-term rentals and cruise lines saw demand growth of 45% and 9%, respectively, from Q1 2019 levels.
• Hotel wage growth matched the national average of 4% in Q1. Job openings per hotel fell nearly 9% to 15 from 17.
• Occupancy rates for all location types continued to lag those of Q1 2019; however, except for resorts, they all had increased occupancy year-over-year in Q1. Urban locations were at 92% of 2019 levels, while interstate locations were the closest to pre-pandemic levels at 99.5%.
• The Super Bowl boosted RevPAR growth in New Orleans, while Tampa's RevPAR was buoyed by hurricane relief efforts. After Columbus, Washington, D.C. and West Palm Beach rounded out the top five RevPAR growth markets in Q1 2025, likely due to demand driven by the presidential inauguration.

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