Hotel performance through 2027 will be significantly better than previously projected, according to the 2026-27 US hotel forecast CoStar and Tourism Economics recently released at the 18th Annual Hotel Data Conference.

Projected gains in average daily rate (ADR) and revenue per available room (RevPAR) for 2026 were upgraded 1.1 percentage points (ppts) and 1.6 ppts, respectively. Occupancy was lifted to 63.1% —  0.3 ppt higher than the previous forecast.  

Amanda Hite, STR’s president, said, “The hotel industry sold a record number of room nights in the first half of the year, an increase of 11.4 million compared with 2025, while room revenue climbed by more than $5.4 billion.”

The industry, said Hite, “outperformed our expectations on stronger leisure and business travel, fueled in part by the World Cup and America 250 celebrations.” In the next six months, she said, “we expect slightly lower gains than in the first half of the year, but top-line growth will still be driven by ADR.”

STR also expects to see a stronger 2027 than what was initially projected in past forecasts, said Hite, “although there will be some midyear weakness due to difficult year-over-year comparisons.”

“With stronger rooms revenue, GOPPAR (gross operating profit per available room) is expected to rise 4% this year and another 1% next year,” said Hite. “Rising expenses continue to be worrisome, increasing by more than the rate of inflation in both 2026 and 2027.”

“We expect travel activity to continue to grow as we move into next year,” said Aran Ryan, director of industry studies at Tourism Economics. “Stable labor markets, recent wealth gains and easing inflation should keep consumer spending resilient, while business investment is broadening beyond AI-related projects and group travel continues to recover. International visitation should see modest improvement, though prolonged US-Canada trade tensions remain a headwind to watch.”