Demand for extended stay hotels in the US gained almost four times the corresponding increase in supply in the first quarter of 2022 compared with the first quarter of 2021, according to the 2022 First Quarter US Extended Stay Hotels Report from the Highland Group, a consultancy. According to the report, rising hotel average daily rate (ADR) nationally enabled extended stay hotels to raise ADR 28% over last year while still gaining occupancy. Room revenues in the first quarter of 2022 were 43% higher than one year ago. Mark Skinner, partner, said that with interest rates and construction costs both rising currently, extended stay supply growth should be relatively low nationally for three to four years, and the segment should set more new performance records during the near term at least. Record high demand for extended stay hotels, low supply growth and rising overall hotel rates, according to the report, enabled extended stay hotels to accelerate rate increases each successive month in the first quarter of this year while also gaining occupancy. The economy and mid-price extended stay segments have already recovered revenue per available room (RevPAR) to their nominal 2019 values, according to the report, and the economy segment is leading the hotel industry recovery by a wide margin. The upscale extended stay segment is lagging the overall extended stay hotel recovery but reporting slightly better recovery performance metrics compared with all upscale hotels, and demand for that segment is at an all-time high.