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Japan and Mexico continued to see strong performance, with RevPAR increasing by 34.5% and 25.2% respectively. – Image Credit Unsplash
U.S. Hotel Industry Performance Fluctuates Amid Key Events and Natural Disasters
U.S. hotel performance sees a surge due to MLK holiday, Presidential Inauguration, and the College Football Playoff Championship but faces challenges due to wildfires and holiday shift.
The U.S. hotel industry experienced a mixed bag of performance the week ending January 25, 2025, with notable events boosting revenue per available room (RevPAR) while natural disasters and a calendar shift caused declines. The Martin Luther King Jr. holiday resulted in a RevPAR increase of 34.4% on Sunday, but the rest of the week saw declines, culminating in an overall RevPAR change of -0.2%.
The Presidential Inauguration in Washington, D.C., and the College Football Playoff Championship in Atlanta significantly lifted RevPAR in these cities, contributing to Sunday’s overall growth. However, without these events, Monday’s RevPAR would have decreased by 16.8%.
Wildfires in the Los Angeles area continued to impact the hotel industry. While demand remained elevated in some areas, downtown Los Angeles and Beverly Hills still reported declining demand. The hurricane displacement demand, which had boosted room demand in 13 markets, is expected to return to more normal patterns as the hurricane impact starts to wane.
Globally, the hotel industry experienced the largest occupancy decline in 10 months. This was largely due to the Lunar New Year calendar shift, which softened performance, especially in China. However, Japan and Mexico continued to see strong performance, with RevPAR increasing by 34.5% and 25.2% respectively.
Despite the recent slowdown, the outlook for the upcoming quarter is positive. Hotel occupancy for the next 90 days is generally showing positive trends. The Super Bowl is also expected to boost hotel occupancy.
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