Dive Brief:

• For the week ending June 27, hotels saw solid performance growth thanks in part to World Cup matches, with RevPAR increasing 9.6% year over year, ADR up 9.2% for the period and occupancy mostly flat at 0.4%, according to performance data from CoStar. 
• World Cup host city Miami saw the highest increase in ADR, up 51.1% year over year for the week ending June 27, and RevPAR, up 51.6% year over year. Meanwhile, San Francisco, which hosted two tournament matches, reported the second-largest gains in occupancy and RevPAR, up 10.9% and 40.7% year over year, respectively. 
• CoStar previously forecast a 13% year over year increase in RevPAR for host cities during the tournament, which started June 11 and runs through July 19. So far, for data collected between June 11 and June 27, the RevPAR numbers from the World Cup have surpassed this prediction, with hotels in host cities averaging RevPAR gains “well above 20%,” per Didio Pequeno, director of hospitality market analytics at CoStar.

Dive Insight:

According to Pequeno, host cities San Francisco, Dallas and Kansas City, Missouri, saw the highest RevPAR gains from June 11-27, at 54.5%, 27.2% and 25%, respectively. He noted the Bay Area hotels saw “poor performance” last year, which makes numbers this summer look “a little bit better.” 

RevPAR upticks have largely been driven by rate, with occupancy remaining relatively flat across host cities. “Our story was always that this was not going to be an occupancy event — this is going to be an ADR event,” Pequeno said, “and that’s definitely proven to be the case when you look at most of the markets.” 

Through the end of June, San Francisco and Dallas were the only two U.S. host cities to see occupancy gains, according to Pequeno. Most other host cities experienced a dip in occupancy; however, “significant” rate increases helped offset these declines, he said. 

“Really [the rate increases] just speaks to the fact that the World Cup traveler is a traveler that’s willing to pay more,” Pequeno said. “And they've displaced American travelers who would have paid less to go to the same markets this summer.” 

Out of San Francisco, Dallas and Kansas City, Pequeno said Dallas’ lift was most expected, since AT&T Stadium in Arlington, Texas, is hosting the most matches of the tournament at nine.  

Meanwhile, Kansas City, the smallest U.S. host city for the tournament, saw ADR up 34% year over year for June 11-27, per Pequeno. 

According to Pequeno, looking ahead, U.S. hotel performance in host cities will depend on which teams end up advancing, since certain countries have large and dedicated traveling fan bases.

The final match at MetLife Stadium in New Jersey on July 19 should bring a notable lift to hotels in nearby New York City, he said. 

“I think the final will be like a Super Bowl-level event,” Pequeno said.