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ARLINGTON, Virginia—CoStar and Tourism Economics made significant adjustments to the 2026-27 U.S. hotel forecast.
For 2026, projected gains in average daily rate (ADR) and revenue per available room (RevPAR) were upgraded 1.0 ppts and 2.2 ppts, respectively. Occupancy for the year is now expected to grow after the previous forecast projected a year-over-year decline in the metric.
“The cautious optimism that framed our outlook earlier in the year has made way for a more robust forecast, driven by stronger demand from both the group and transient segments,” said Jan Freitag, national director of hospitality analytics at CoStar Group. “Since our last revision, the industry has seen sustained performance growth, with room demand up by more than 8 million room nights year over year through the first four months of 2026. For the remainder of the year, we expect a moderation in demand growth, but the pace will remain conducive for solid ADR and RevPAR gains, even though both will continue to increase below the rate of inflation.”
“Travel activity appears resilient heading into the summer. Stable job markets and rising household wealth are supporting leisure travel demand despite higher fuel prices,” said Aran Ryan, director of industry studies at Tourism Economics. “Group travel is also improving alongside robust corporate profits, while international visitation remains weak with hopes of a World Cup bounce. Looking ahead, easing inflation should support a modestly stronger economy next year.”
“GOP is expected to rise on increasing total revenues, with the largest growth contribution coming from the rooms department,” said Freitag. “However, expenses are anticipated to grow at a higher rate, resulting in a continued squeeze in profit margin.”
