Global RevPAR Growth Continues Despite Olympic Comparisons, U.S. Markets Struggle

U.S. hotel industry sees mixed RevPAR performance amidst challenging market conditions, while global growth remains positive despite 2024 Olympic comparisons.

The U.S. hotel industry experienced a decline in performance for the week ending August 9, 2025, with revenue per available room (RevPAR) decreasing by 1.6% due to reduced occupancy and average daily rate (ADR). This downturn was influenced by challenging market conditions in key regions and last year’s Hurricane Debby, which created favorable comparisons in some Southeast markets. Globally, RevPAR growth continued, although it was impacted by comparisons to last year’s Paris Summer Olympics.

U.S. Market Performance

During the week ending August 9, 2025, the U.S. hotel industry faced a 1.6% decline in RevPAR, driven by a 0.7 percentage point drop in occupancy and a 0.6% decrease in ADR. The performance was further complicated by the ongoing negative influence of markets such as Houston and Las Vegas, which together represent a significant portion of the Top 25 Markets. Despite excluding these two markets, the Top 25 Markets still experienced a 2.5% decrease in RevPAR, nearly double the decline of the rest of the U.S.

Hurricane Debby, which made landfall in the Southeast U.S. last year, created a challenging comparison base for this year. Markets affected by the hurricane, such as Augusta, Charleston, and Tampa Bay, saw demand return to normal levels, resulting in double-digit RevPAR growth. Excluding these markets, U.S. RevPAR would have decreased by 1.1%, and when excluding Houston and Las Vegas, the decline would have been 0.2%.

Chain Scale and Market Variability

Luxury hotels were the only chain scale to consistently show gains throughout the summer, but they experienced a slight slowdown in the most recent week, with RevPAR declining by 0.1%. The lower chain scales, particularly Economy, saw a more significant decline, with RevPAR down 5.7%. When excluding the hurricane-affected markets, as well as Houston and Las Vegas, Luxury RevPAR decreased by 1.3%, while Economy hotels saw a less severe decline of 3.4%. Midscale and Upper Midscale hotels showed slight improvements, while Upscale and Upper Upscale remained relatively unchanged.

Group Demand Trends

Group demand in Luxury and Upper Upscale hotels declined for the fifth consecutive week, with a 6.2% decrease in the most recent period. The Top 25 Markets experienced a 9.6% drop in group demand, and even when excluding Las Vegas and Houston, the decline persisted. Non-Top 25 markets also saw a decrease in group demand, albeit at a lower rate of 1.2%. Despite these challenges, group ADR remained healthy, with increases of 3.4% in the Top 25 and 2.1% in non-Top 25 markets. In contrast, transient demand among Luxury-Upper Upscale hotels showed positive trends, with a 1.9% increase in rooms sold, although ADR dipped by 0.8%.

Top 25 Market Highlights

San Francisco continued to be a standout performer among the Top 25 Markets, with RevPAR growth of 22.2%, driven by events like the World Transplant Congress. Other markets, such as Tampa Bay and Miami, benefited from favorable year-over-year storm comparisons, while Dallas and Detroit also posted strong results. On the other hand, Houston experienced a significant RevPAR decline of 36.4%, and New Orleans struggled with low occupancy rates, leading to a 20.3% drop in weekly RevPAR. Las Vegas also faced challenges, with an 18.9% decrease in RevPAR.

Global RevPAR Trends

Globally, RevPAR growth continued, although it was affected by comparisons to last year’s Paris Summer Olympics. Global RevPAR declined by 3.7% this week, primarily due to a 61.7% drop in France, where ADR fell by 56.3% and occupancy decreased by 9.8 percentage points. Excluding France, global RevPAR rose by 5.6% and has been positive for most of the year. Japan, Canada, and Spain delivered strong RevPAR gains, while China continued to face challenges with declining RevPAR for the past 13 weeks.

Looking Ahead

As summer concludes, the U.S. hotel industry faces ongoing RevPAR deficits, particularly in the Top 25 Markets, even after accounting for atypical comparisons such as storm impacts. Rising inflation and operational expenses are outpacing room revenue growth, leading to declining profit margins. The fall conference and meeting season will be closely watched following a lackluster summer for group performance. On a global scale, RevPAR growth remains positive, excluding France, and does not appear to be at risk of turning negative in the near future.

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