Dive Brief:
- In their first U.S. hotel performance forecast of the year, CoStar and Tourism Economics projected increases for key growth metrics, including RevPAR and ADR, in 2026 and beyond.
- CoStar and Tourism Economics said ADR will rise 1% year over year in 2026, while occupancy will decrease slightly from 2025 to 62.1%. This will result in 0.6% year-over-year growth in RevPAR in 2026, per the outlook. Meanwhile, the firms forecast gains across all key performance indicators in 2027.
- The outlook comes after U.S. hotel occupancy and RevPAR declined year over year in 2025 for the first time since 2020. Future performance growth will be driven by multiple factors, including a more stable travel environment and strengthening consumer spending, according to Aran Ryan, director of industry studies with Tourism Economics.
Dive Insight:
CoStar and Tourism Economics upgraded their 2026 outlook for U.S. hotel occupancy, ADR and RevPAR compared to their final forecast revision of 2025, published in November. According to Ryan, a “more supportive backdrop for U.S. travel in 2026” is expected, which could catalyze performance gains.
“International travel faces near-term headwinds but will likely see a gradual rebound as global demand strengthens and the World Cup boosts summer arrivals,” he said in the outlook. International travel was dampened in 2025 by geopolitical tensions and broader economic uncertainty.
In 2026, World Cup host markets and their surrounding areas could see notable gains in hotel performance, Amanda Hite, president of CoStar subsidiary STR, said in the outlook.
Top-line performance is expected to strengthen in the second half of the year, though “growth will remain moderate and concentrated among higher-tier hotels,” Hite said. A growing wealth bifurcation suggests that luxury consumers will drive hotel bookings in 2026, hospitality industry professionals shared with Hotel Dive earlier this year.
A softer job market will weigh on younger and lower-wage households in 2026, Ryan said, but “real wage gains and household wealth should keep consumer spending resilient.”
Looking further ahead, CoStar and Tourism Economics forecast that U.S. RevPAR will increase 1.4% year over year in 2027.
