Global leisure travel patterns are undergoing a notable realignment as economic and political headwinds emanating from the United States redirect international tourists toward more accessible and stable destinations.
Hotel profit margin, which measure profits as a percent of revenue, is considered a good indicator of the efficiency of hotel operations. In 2023 and 2024, hotel profit margins at both the Gross Operating Profit (GOP) and Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) level have declined, indicating that both operating and ownership expenses have increased at a greater pace than revenues. Based on CBRE’s February 2025 Hotel Horizons® Investment Performance forecast, this trend is expected to continue into 2025, and potentially a few years beyond that.
The Newark Airport hotel market has faced significant adjustments since the onset of the COVID-19 pandemic. Changes to the submarket’s hotel supply, coupled with the rebound in passenger levels through Newark Airport, have resulted in a slow but steady recovery of the hotel market. Recent and upcoming expansion projects at Newark Airport support a positive outlook.
Behind the reassuring headlines of strong bookings and stable occupancy rates, a deeper story is unfolding. Shifting traveler behavior, rising domestic demand and a growing need for adaptability in the face of political and economic uncertainty.
The hospitality industry, particularly in the United States, is at an inflection point. Economic indicators are flashing caution, sentiment is softening, and the easy growth of the past few years is giving way to a more sobering reality. At Horwath HTL, we believe this environment is not one to fear – but one to understand and strategically engage with.
The Baton Rouge lodging market is stabilizing after several years of mixed performance. Record-high ADR and demand tied to industrial projects are helping to balance ongoing occupancy challenges and longstanding supply pressures. Future demand growth will depend on correcting the hotel and event supply issues.
Fresh from the Hunter Conference, two themes reign supreme right now. The first is uncertainty. Following last week's tumultuous stock market sell-off and the ongoing tariff chaos, our outlook on the future remains as uncertain as it was two years ago, if not more so today. The second theme is the beer and wine analogy: while wine appreciates in value with age, no one wants an old beer. Having sold nearly 300 hotels over the past five years, thanks to Mitch Patel from Vision Hospitality Group, I feel more like I'm in the liquor wholesale business than hotel brokerage. With that in mind, my comments will center around our beloved beer and wine theory:
India has received a short break on the tariff front, but the bigger picture remains complex. Earlier this month, the US administration announced a steep 26% tariff on Indian imports, sparking concerns across trade-focused sectors. Fortunately, a 90-day suspension has been granted, offering India, along with several other countries, a temporary pause and a crucial opportunity for trade discussions.Key Indian export sectors like electronics, gems and jewelry, textiles, and auto components are watching the developments closely as these industries have strong export ties with the US. If the tariffs are enforced after the suspension period, many could face higher input costs, lower margins, and reduced global competitiveness.Yet, amidst the uncertainty, there is an underlying opportunity. Trade experts believe this could prompt long-overdue reforms, such as streamlining India’s tariff structures, improving import policies, and increasing investments to strengthen domestic manufacturing and supply chains. As trade talks progress over the coming weeks, the spotlight will be on how India positions itself, not just in relation to the US, but within the rapidly evolving global trade landscape.The travel and hospitality sector in India, while not directly impacted by the tariffs, could feel the ripple effects over time. With the global economic environment in a state of flux, marked by protectionist trade policies, recessionary signals in some regions, and general uncertainty, travel demand may begin to soften. These factors can influence discretionary spending, which in turn could affect both corporate and leisure travel.
I have been teaching with metrics for a long time. Before teaching, I worked for a consulting firm and was immersed in the world of hospitality metrics. Prior to that, as a restaurant manager on both coasts, I focused, for managers and owners, on food and labor costs. In the old days, restaurants were very food-cost oriented. I can calculate food cost percentage, but it reminds me that unless you lock the front doors of your restaurant and serve no one, the restaurant will incur food costs as a function of the food they sell.
Singapore, a city-state spanning 734 square kilometres with a population of approximately 6.04 million, remains one of the world’s top travel and business destinations. Its modern infrastructure, cultural diversity, and strategic location continue to attract millions of visitors annually.
We have questioned ourselves quite a bit about the profound consequences of the health crisis on leisure and travel. Which trends would persist between the family refuge within a close and natural environment or the urge to live even more intensely, to explore even more unknown lands, even if it means breaking the bank?
Visitation and other tourism indicators in 2024 met or exceeded most 2023 totals. Las Vegas hosted 40.8 million visitors in 2024, surpassing the 40-million visitor threshold for the second year in a row. Gaming revenue for Clark County in 2024 was $13.5 billion, setting a new annual record for the third straight year. In 2024, occupied room nights, as well as total occupancy (83.6%), continued to lag pre-COVID pandemic performance; however, ADR and RevPAR reached record levels.
The Caribbean hotel market has long been one of the most enviable and robust sectors in the global hospitality industry. Thanks to its convenient proximity to the United States, the Caribbean offers an unbeatable combination of weather, sun, and adventure, attracting millions of visitors annually and fueling tourism-dependent economies. Following the 2020-2021 downturn in the travel industry due to the COVID-19 pandemic, the market continues to improve and flourish, albeit at a slower pace in the last 12 months compared with prior years.
The Downtown St. Louis hotel market steadily recovered from the impact of the COVID-19 pandemic until 2024, when the recovery stalled due to a correction in leisure demand and disruptions at the convention center. However, subsequent airport passenger traffic growth and completion of the convention center’s expansion, along with other trends and developments, provide a stronger outlook for the market in 2025 and beyond.
The Montréal hotel market has made a strong comeback from the pandemic, experiencing a 4.6% rise in room supply, in contrast to the declines in Downtown Toronto and Vancouver. This expansion, combined with a rebound in air travel, extensive hotel renovations, and effective tourism promotion, has positioned Montréal as the most resilient market. With substantial investments and a thriving meetings and events sector, the city’s hotel industry is undergoing a significant evolution.
This research article analyzes the performance of the hotel market in Baltimore for the trailing four quarters ending in Q3 2024, with a specific focus on key metrics such as occupancy, average rate (ADR), and revenue per available room (RevPAR). The report highlights the positive impact of the removal of approximately 2,500 hotel rooms from the downtown supply and discusses the potential for improved hotel performance in 2025. With strong growth in ADR and RevPAR despite some challenges in the market, the analysis suggests a robust outlook for the city’s hotel sector as demand continues to strengthen, and hotel operators capitalize on reduced supply to push rates and increase occupancy.
Our views around the world reflect early optimism for 2025, with the anticipation of stronger transaction activity and modestly improving hotel metrics in most regions.
The Boston lodging market continues to progress, steadily closing the gap on pre-pandemic RevPAR levels (inflation adjusted). With the new-construction pipeline empty and a record year anticipated in the convention sector, the market’s future is among the brightest in the nation.