Revenue per available room (RevPAR) in August for extended stay hotels fell for the fifth consecutive month. It was also the largest drop this year, according to the latest report from The Highland Group, a consultancy. However, economy segment extended stay hotels reported a modest 1.3% decline in RevPAR, which was far lower than the 5.7% contraction STR/CoStar estimated for all economy class hotels. It was also a smaller decline than all classes of hotels except upper upscale and luxury segments, which are leading the overall US hotel industry.

Mark Skinner, partner at The Highland Group, said August’s performance metrics “further indicated that economy extended stay hotels are weathering the hotel industry downturn better than most classes of all hotels, especially at lower price points.”

Total hotel demand declined slightly in August, according to STR/CoStar. Extended stay hotel demand increased. However, higher supply growth in the extended stay category resulted in occupancy falling to its lowest level for August in four years. Extended stay room nights available increased 4.4% in August 2025 compared with August 2024.

While still below the long-term trend, the 2.2% gain in extended-stay demand in August was the second largest monthly increase in seven months. Comparatively, STR/CoStar reported total hotel industry demand declined 0.4% in August. When the additional day last year is considered for February, monthly extended stay hotel demand has recorded a positive change in 32 of the last 33 months.

The 2.1% decrease in extended stay hotel occupancy in August was the eighth consecutive monthly decline. August’s occupancy contraction was greater than the 1.3% occupancy loss STR/CoStar estimated for all hotels. Still, extended stay hotel occupancy in August was 11.3 percentage points higher than the total hotel industry, which is typical for a late summer month.

Extended stay hotel average daily rate (ADR) in August declined for the fifth consecutive month (down 1.8%). The fall in total extended stay hotel ADR was partly because the economy segment’s share of extended stay room supply was significantly higher in August 2025 compared with August 2024. The economy extended stay segment’s decrease in ADR (down 0.8%) was the first monthly contraction since May 2024, but it compares very favorably with the 3.4% loss for total economy class hotels as reported by STR/CoStar.