Executive Summary
Hotel fundamentals softened in Q2, largely due to a 1.5% year-over-year drop in occupancy. The average daily rate (ADR) increased by 2.6% year-over-year, its slowest annual growth since Q1 2021. Revenue per available room (RevPAR) increased by just 1.1% year-over-year, a material slowdown from Q1's 15.9% pace.
Total inbound foreign visitors were 27% below pre-pandemic 2019 levels, while the number of Americans traveling to Europe and the Caribbean increased by 5% and 8%, respectively.
Hotel wage growth slowed in June but at 5.2% outpaced the national average of 4.7%. Hotel wage growth pressures are likely to persist, at least for the near term.
Leisure markets remained the strongest RevPAR performers relative to 2019; however, Q2 RevPAR declined from last year in several of them, including West Palm Beach, Savannah, Phoenix and St. Petersburg.
Occupancy rates for all location types were below 2019 levels in Q2. Urban locations were the only category to post year-over-year gains, with the other five location types contracting vs Q2 2022.
https://www.cbre.com/-/media/project/cbre/shared-site/insights/figures/2023-figures-media-folder/q2-2023-us-hotel-figures-media-folder/q2-2023-us-hotel-figures.pdf