Overview of U.S. Resort Business Efficiency
Within the week ending August 23, 2025, the U.S. resort trade skilled a 1.3% lower in income per out there room (RevPAR), marking the third consecutive week of decline and the tenth drop up to now twelve weeks. The downturn was primarily pushed by a lower in occupancy, accompanied by a slight decline within the common day by day fee (ADR) of 0.2%. The Prime 25 Markets have been largely answerable for this decline, with a RevPAR drop of three.8%, whereas all different markets noticed a modest enhance of 0.4%.
Impression of Key Markets: Chicago and Houston
Chicago and Houston have been important contributors to the nationwide decline in RevPAR. In Chicago, in comparison with the week of final yr’s Democratic Nationwide Conference, RevPAR dropped by 19.9% as a result of a 22.3% fall in ADR, regardless of a 2.2 share level enhance in occupancy. The central enterprise district (CBD) of Chicago, the biggest submarket, noticed occupancy rise to 76.9%, though it additionally confronted essentially the most important ADR impression from final yr’s conference. Different submarkets, resembling Chicago O’Hare Airport and Chicago Southwest, shared within the ADR and RevPAR declines.
Houston confronted challenges from tough comparisons to final yr, when spring storms elevated room demand considerably. Demand in Houston was down 29.5% this yr, in comparison with a 32% enhance final yr. The Midscale and Economic system class motels in Houston have been significantly affected, with RevPAR dropping by greater than 50% over the previous 4 weeks. It’s anticipated that these difficult comparisons will ease within the coming weeks, though a efficiency drag is anticipated to persist till the tip of the yr.
Luxurious Class Development Amidst Broader Decline
Regardless of the general downturn, luxurious class motels have continued to expertise progress in RevPAR, a pattern that has been constant over the previous 4 weeks. In distinction, the Higher Upscale class noticed declines primarily as a result of decrease occupancy, whereas different courses confronted decreases pushed by falling ADR. Within the Prime 25 Markets, excluding Houston and Las Vegas, all courses besides Luxurious nonetheless skilled declines, albeit to a lesser extent.
World Markets Present Optimistic Tendencies
Globally, RevPAR elevated by 5.4% for the second consecutive week, following 4 weeks of decrease progress. This enchancment was partly as a result of overcoming the Olympic comparability in France, the place RevPAR rose by 24% this week. Over the previous 4 weeks, nations resembling Spain, Italy, Canada, Japan, and the UK reported RevPAR will increase exceeding 5%, with Spain main the pack. Notably, all these nations, besides Italy, maintained occupancy charges above 80%.
Canada has demonstrated constant progress, with RevPAR rising in 24 of the previous 34 weeks, primarily pushed by ADR progress. In the newest week, Canada’s RevPAR was up by 5.2%, persevering with a pattern of over 4% progress in Could, June, and July, with related expectations for August.
Calendar Impacts on Future Efficiency
The calendar adjustments in August and September are anticipated to impression resort efficiency outcomes. August will conclude with an extra Sunday, which, mixed with present weaknesses, suggests a possible RevPAR lower just like July’s figures, regardless of anticipated record-breaking journey over the Labor Day vacation. Moreover, September will likely be affected by the shift of Rosh Hashanah into the month from October final yr, leaving solely two “clear” weeks for group and enterprise journey.
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