CoStar, Tourism Economics raise U.S. hotel growth forecast
CoStar and Tourism Economics upgraded their 2026 U.S. hotel forecast, with RevPAR up 2.2 ppts, driven by 8M+ additional room nights YoY through April, though expense growth will continue to pressure profit margins.
ARLINGTON, Va. – CoStar and Tourism Economics made significant adjustments to the 2026-27 U.S. hotel forecast.
For 2026, projected gains in average daily rate (ADR) and revenue per available room (RevPAR) were upgraded 1.0 ppts and 2.2 ppts, respectively. Occupancy for the year is now expected to grow after the previous forecast projected a year-over-year decline in the metric.
The cautious optimism that framed our outlook earlier in the year has made way for a more robust forecast, driven by stronger demand from both the group and transient segments. Since our last revision, the industry has seen sustained performance growth, with room demand up by more than 8 million room nights year over year through the first four months of 2026. For the remainder of the year, we expect a moderation in demand growth, but the pace will remain conducive for solid ADR and RevPAR gains, even though both will continue to increase below the rate of inflation.
Jan Freitag, national director of hospitality analytics at CoStar Group
Travel activity appears resilient heading into the summer. Stable job markets and rising household wealth are supporting leisure travel demand despite higher fuel prices. Group travel is also improving alongside robust corporate profits, while international visitation remains weak with hopes of a World Cup bounce. Looking ahead, easing inflation should support a modestly stronger economy next year.
Aran Ryan, director of industry studies at Tourism Economics
“GOP is expected to rise on increasing total revenues, with the largest growth contribution coming from the rooms department,” said Freitag. “However, expenses are anticipated to grow at a higher rate, resulting in a continued squeeze in profit margin.”
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CoStar Group (NASDAQ: CSGP) is a global leader in commercial real estate information, analytics, online marketplaces, and 3D digital twin technology. Founded in 1986, CoStar Group is dedicated to digitizing the world’s real estate, empowering all people to discover properties, insights, and connections that improve their businesses and lives.
CoStar Group’s major brands include CoStar, a leading global provider of commercial real estate data, analytics, and news; LoopNet, the most trafficked commercial real estate marketplace; Apartments.com, the leading platform for apartment rentals; Homes.com, the fastest-growing residential real estate marketplace; and Domain, one of Australia’s leading property marketplaces. CoStar Group’s industry-leading brands also include Matterport, a leading spatial data company whose platform turns buildings into data to make every space more valuable and accessible; STR, a global leader in hospitality data and benchmarking; Ten-X, an online platform for commercial real estate auctions and negotiated bids; and OnTheMarket, a leading residential property portal in the United Kingdom.
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