U.S. Hospitality operating performance indicators provided mixed signals in Q4 2023 on a year-on-year basis. The Average Daily Rate (ADR) and Revenue Per Available Room (RevPAR) experienced marginal growth of 2.9% and 1.3% respectively. Meanwhile, quarterly occupancy rates fell 160 basis points when compared to the same period a year prior. The final quarter of 2023 marks three consecutive quarters of occupancy rate losses across the greater U.S. Hospitality sector, following a 50-basis point decrease in Q3 and a 60-basis point decrease in Q2. The downward pressure on occupancy rates is largely a byproduct of muted demand from the corporate transient and leisure travel demand sources in the face of economic uncertainty and an inflationary environment in the back-half of 2023. Looking forward into 2024, a positive GDP outlook and a favorable PCE reading in January 2024 are expected to serve as tailwinds for demand from both the corporate transient and leisure demand sources. Coming regulation and in-place regulation on short-term rentals, paired with easing international travel restrictions are also potential occupancy drivers. Conversely, inflation readings above the Fed’s target level of 2% will result in continued growth of ADR.

This Colliers U.S. Hospitality Data Snapshot compares the operating performance of the wider U.S. Hospitality sector to the operating performance of the U.S.’s major hospitality brands and sub-brands.

Download the report here.