The U.S. hotel industry experienced a mostly flat week in RevPAR, with notable performance variations across different markets, while global RevPAR growth slowed due to occupancy and ADR declines.
U.S. Hotel Industry Overview
The U.S. hotel industry witnessed a mostly flat week for July 20-26, 2025. Revenue per available room (RevPAR) saw a marginal decline of 0.8%, marking the fifth consecutive week of downturns. The demand slightly improved, but with a 0.9% increase in room supply, occupancy decreased by 0.2 percentage points. The average daily rate (ADR) remained stagnant, marking four weeks of stalled rate growth.
A significant factor affecting the current week’s performance was the comparison to the previous year, which saw a tech outage that temporarily boosted hotel performance. This year, Sunday experienced a notable RevPAR decline of 4.7%, followed by a 2.1% drop on Monday. Midweek performance remained soft, reflecting sluggish business demand, while the weekend showed improvement with a 1.7% increase, driven by leisure travel.
Top 25 Market Analysis
The Top 25 Markets experienced a more pronounced RevPAR decline of 1.7% compared to the rest of the country, which posted a nearly flat RevPAR of 0.2%. Two markets significantly impacted the Top 25 performance:
Houston: RevPAR decreased by 25.9% due to a challenging comparison with last year, which saw elevated displacement demand from Derecho storms and Hurricane Beryl.
Los Angeles: Experienced a 10.5% decline in RevPAR, with the Central Business District (CBD) seeing a 29.5% drop, affected by market tensions and reduced group and transient demand.
Excluding Houston and Los Angeles, the Top 25 Market RevPAR was flat, with occupancy down 0.8 percentage points and ADR up by 1.0%.
Las Vegas Performance
Las Vegas reported a positive week, breaking a 12-week streak of negative RevPAR comparisons with a 6.2% increase. This growth was primarily driven by a 7.9% increase in ADR, despite a 1.2 percentage point decline in occupancy. The weekend RevPAR surged by 42.7%, thanks to numerous concerts, including Beyoncé’s Cowboy Carter concert at Allegiant Stadium, along with performances by the Backstreet Boys and renowned EDM artists. However, weekday RevPAR declined by 13.5%, influenced by conference calendar shifts and tech outage comparisons.
Performance of Other Markets
Most Top 25 Markets saw improvements from their recent four-week averages. Notable growth markets included Chicago with a 10.9% increase and St. Louis with a 9.1% rise, both showing strong weekday and weekend performance. Other markets with RevPAR gains above 5% included Orlando, Anaheim (Orange County), and New York City.
Conversely, New Orleans, Boston, and San Diego faced challenges, posting RevPAR declines each week. New Orleans, in particular, has experienced persistent decreases throughout the summer season. Washington, D.C., also saw a decline over the past three weeks, with the latest drop reaching double digits at 12.5%.
Luxury Segment Dominance
Luxury hotels led all other chain scales with a RevPAR growth of 1.9% for the week, while the Economy segment experienced the sharpest decline at 4.4%. The day-of-week analysis revealed that Luxury hotels maintained positive RevPAR growth even on weekdays, unlike other chain scales. Weekend RevPAR growth was notably higher for Luxury chains, followed by Upper Upscale.
Demand increased across all chain scales except for the Economy segment. However, supply growth has largely outpaced demand, posing challenges to maintaining occupancy, particularly among Upper Midscale and higher chains.
Global Market Trends
Globally, RevPAR excluding the U.S. declined by 1.5%, driven by decreases in occupancy (0.5 percentage points) and ADR (0.8%). Despite being the peak travel season, occupancy reached 73.4%, the highest level of the year thus far. However, occupancy has consistently declined over the past five weeks. ADR comparisons remained positive for most of the year, with negative readings occurring only four times, three of which were in the past seven weeks, indicating a slowdown in global pricing power.
Countries such as Japan, Canada, Spain, and Indonesia have shown strong RevPAR gains, with Japan and Indonesia’s performance driven by ADR, while Canada and Spain benefited from modest occupancy gains. In the United Kingdom, Aberdeen and Manchester stood out with over 30% RevPAR gains due to major events.
France and Germany experienced declines due to shifts in major event calendars. China’s RevPAR declined by 5.1%, with Beijing and Guangzhou seeing the greatest declines among top-tier cities.
Future Outlook
As July concludes, many U.S. school districts are preparing for the fall term, which is expected to slow family travel. Demand and occupancy are anticipated to decrease in August, with leisure-oriented weekends maintaining a slight advantage over business-oriented weekdays. Consumer sentiment surveys indicate improved travel perceptions and plans, presenting an opportunity for the industry to capitalize on potential travelers planning trips for the remaining summer weeks.
Globally, the summer season will continue for a bit longer, with peak travel expected in two weeks. Travel is expected to slow until the conference season picks up in mid-September. The recent RevPAR slowdown was anticipated, and its magnitude will become clearer as the year progresses into the final quarter of 2025.
