Us Hotel Demand Struggles As Summer Peaks: A Closer Look At Declining Performance Across Major Cities, What Travellers Need To Know

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Saturday, July 19, 2025

With nan summertime gearing up to its summertime peak, U.S. hotels are connected gait to a challenging highest successful demand, arsenic gross per disposable room (RevPAR) decreased by 3.7% for nan week of July 6-12, pursuing a drawstring of losing weeks including nan 1.1% alteration nan week prior. The summertime finds U.S. hotels traditionally buoyed by beardown demand, but this year’s play is underwhelming hoteliers. The weakness is pronounced connected nan weekday (Monday done Wednesday) side, which is lackluster and indicates anemic business travel. By contrast, weekends person held steady, though leisure recreation is besides slowing amid concerns complete nan system and expanding title from alternate forms of lodging for illustration short-term rentals, camping and cruises.

This divergence successful recreation behaviour is striking, arsenic full TSA rider screenings were connected nan emergence complete nan aforesaid interval that edifice request was sagging. This could mean that travelers are choosing alternatives to nan accepted edifice stay. As much group look to alternatives, specified arsenic Airbnb, and VRBO, nan edifice manufacture successful nan U.S. is emotion nan unit of increasing competition.

Business Travel Declines While Leisure Remains a Mixed Bag

The soft edifice request crossed nan U.S. is mostly attributed to nan continued weakness successful business travel. Group business request has been peculiarly lackluster, pinch luxury and upper-upscale hotels experiencing a 9.8% diminution successful group request year-over-year. While nan mean regular complaint (ADR) for group business has remained strong, increasing by 3.6%, this summation has not been capable to offset nan driblet successful demand.

Luxury hotels saw a 2% driblet successful RevPAR, while nan diminution successful different concatenation scales was much pronounced, pinch system chains reporting a 5% drop. The capacity of hotels crossed nan U.S. is not uniform, pinch higher-end hotels faring somewhat amended owed to their entreaty to wealthier travelers, while fund chains struggle more. The inclination of weaker weekday capacity was observed crossed each edifice segments, pinch upper-upscale hotels experiencing nan largest weekday RevPAR diminution of -7.6%.

On weekends, however, luxury and upper-upscale hotels showed amended performance, pinch RevPAR increasing by 6.5% and 2.6%, respectively. This reflects a stronger marketplace for leisure travel, but moreover this has been tempered by rising economical concerns and title from replacement recreation accommodations.

St. Louis and Other Key Cities See Mixed Results

In nan midst of these challenges, immoderate U.S. cities are seeing affirmative growth. St. Louis, for example, outperformed nan mostly of nan apical 25 U.S. edifice markets, posting a 30.8% summation successful RevPAR. This occurrence is mostly attributed to nan 10-day General Conference of nan Seventh-day Adventist, held from July 3-10, which brought a important boost successful group demand. St. Louis has consistently classed among nan apical 3 edifice markets successful caller weeks, benefiting from some nan convention and a mostly beardown tourism environment.

Meanwhile, cities for illustration Houston struggled pinch edifice demand, facing reliable comparisons to past year’s Hurricane Beryl, which negatively impacted nan market. In Houston, RevPAR saw a melodramatic diminution of 34.2%, pinch 110,000 less edifice rooms sold compared to nan aforesaid week successful 2023.

Other cities besides had mixed performances. Atlanta knowledgeable a 6% maturation successful edifice RevPAR, bolstered by a beardown play driven successful portion by Beyoncé’s Cowboy Carter tour. Chicago and Orange County/Anaheim some saw humble maturation of 4.2%, though nan second was wholly driven by play performance. San Francisco had a beardown play pinch a 35% summation successful RevPAR, but its weekday capacity suffered pinch a 26.5% decline.

Las Vegas, connected nan different hand, continues to struggle pinch play RevPAR declines, though nan metropolis has moved person to nan mediate of nan apical 25 markets, signaling a imaginable betterment if trends stabilize.

What Lies Ahead for nan U.S. Hotel Industry?

With nan summertime play now successful afloat swing, nan mobility remains: is nan U.S. edifice manufacture already peaking? Historical information suggests that July is typically nan highest for U.S. edifice demand, but this year’s capacity points to a imaginable diminution compared to 2023. While user intentions to recreation stay strong, concerns astir economical factors specified arsenic ostentation and expanding accommodation costs person begun to temper spending. Research firms for illustration Longwoods and Future Partners study that while consumers still scheme to travel, they are exercising greater be aware successful their spending habits.

Global edifice markets extracurricular nan U.S. are faring better, pinch RevPAR maturation of 2.2% globally, driven chiefly by ADR increases. Countries for illustration Japan, nan U.K., and Canada person seen affirmative performance, pinch Japan’s RevPAR up 22.1% for nan week, and nan U.K. posting 7.5% growth. These world markets are benefiting from beardown home demand, favorable speech rates, and less competing alternatives, specified arsenic short-term rentals.

The Road Ahead: U.S. Hotels Brace for Further Challenges

What’s next: much of nan aforesaid for U.S. hoteliers successful nan shape of declining request and ADR (average regular rates), mixed pinch competing pinch replacement accommodations. The summation successful world recreation and desire for short-term rentals and cruises could beryllium presenting a situation for U.S. hotels to prolong coagulated capacity rates done nan remainder of 2023 and into 2024.

Though individual cities for illustration St. Louis whitethorn still outshine their peers, nan broader assemblage is nether unit from economical worries, shifting recreation demands and title from alternatives for illustration newer forms of enactment complete lodging.

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