Was there growth in revenue per available room in the first full week of February? Depends on your lens.
In the week ending Feb. 8, U.S. hotel industry RevPAR decreased if you factor in Super Bowl comparisons. If you exclude the impacts of the annual mega event, RevPAR grew. While that might sound counterintuitive, remember last year’s oversized impact on performance.
In 2024, the Super Bowl was in Las Vegas, the nation’s largest hotel market. During the comparable week, average daily rate topped $406 and made up 10% of room revenue across the U.S.
This year’s Super Bowl host, New Orleans, is the nation’s 33rd largest STR-defined hotel market. New Orleans’ Super Bowl week ADR ($486) was higher than Las Vegas, but its contribution to total U.S. room revenue was only 3%.
That difference is why U.S. weekly RevPAR was down 2.7% for the week as occupancy dropped 0.5 percentage points and ADR decreased 2.2%. Removing both Las Vegas and New Orleans, the rest of the country showed moderate RevPAR growth (+2.2%).
For the rest of this analysis, we’ll exclude Las Vegas and New Orleans unless otherwise noted. That will provide a clearer view of changes in the remainder of the country.
Top 25 and hurricane markets leading RevPAR growth
U.S. hotel occupancy during the week of Feb. 2-8 was 55.5%, flat to last year and down slightly from the week prior (55.8%). ADR lost momentum, rising 2.1% year over year versus more than 3% gains in the previous two weeks. The slowdown in ADR growth was centered on weekdays – Monday to Wednesday – when ADR growth was half of what it was a week earlier (+2.6% vs. +5%). Weekday occupancy gains were also more tempered. Even with the lower increase, weekday RevPAR growth was the highest of the week (+2.9%), followed by shoulder days Sunday and Thursday, when RevPAR growth rose 2.6%. Hotel RevPAR on weekend days Friday and Saturday increased 0.8%.
In the top 25 U.S. hotel markets, Tampa saw the largest RevPAR change (+21.1%) with Washington, D.C. (+12.1%) a distant second followed by Orlando (+8.9%). Los Angeles and Seattle also saw strong RevPAR growth in excess of 7%.
On the flip side, six markets saw hotel RevPAR decline, including Denver (-13.5%) and Nashville (-13.1%). Atlanta, Oahu, Phoenix and St. Louis were the other top 25 markets that reported RevPAR declines.
New York City also had an off week as RevPAR increased by only 1.3% due to a weekend decrease (-7.2%). New York’s weekday RevPAR was up 6.4%.
In the non-top 25 markets, RevPAR growth was led by many of the 13 hotel markets affected by Hurricane Helene and Hurricane Milton. North Carolina West posted the nation’s largest RevPAR gain (+54.6%) followed by Augusta, Georgia (+40.7%). Collectively, the 13 markets saw RevPAR rise 15.9%, which was nearly identical to the previous week’s growth. Occupancy gains – up 5.9 percentage points – continued to drive the increases in most of these markets.
Tucson, not included in that group of 13 hurricane markets, recorded the third highest RevPAR gain in the country (+34.9%) Overall, RevPAR in the non-top 25 markets was up 1.7% as compared to up 2.8% for the top 25 markets. Excluding the hurricane markets, non-top 25 RevPAR was nearly flat (+0.7%) because of falling occupancy.
Los Angeles occupancy elevated but slowing
In the greater Los Angeles area – STR-defined hotel markets include Los Angeles, Inland Empire, California Central Coast, and Orange County – RevPAR increased 5.2% all on occupancy gains. Collectively and over the past five weeks, RevPAR in the area has increased 6.6% on occupancy as ADR is up only 0.8%.
Since massive wildfires began in the region, four submarkets have seen large increases in hotel occupancy: Pasadena/Glendale/Burbank (+20.9 percentage points), Los Angeles East (+15.5 percentage points), Los Angeles North (+11.6 percentage points) and Oxnard/Ventura (+9.1 percentage points).
In the most recent week, these four submarkets saw occupancy advance collectively by 11.6 percentage points, which was less than the previous four weeks where the measure was up by more than 14 percentage points.
Hollywood/Beverly Hills continued to see occupancy fall – this week down 4.9 percentage points – but that was the smallest decline since the week ending Jan. 11.
Not much movement in group
Among luxury and upper-upscale hotels, group occupancy rose 0.5 percentage points with mostly flat ADR (+0.6%). Weekend group showed the largest occupancy gain – up 1.1 percentage points – but with falling ADR (-1.3%).
New Orleans scores big, Las Vegas percentage changes obviously retreat
Bringing the 2024 and 2025 Super Bowls back into the equation, hotel RevPAR in Las Vegas dropped 62.5% on a 54.9% decrease in ADR. New Orleans’ RevPAR was up 135% on a 107% ADR increase.
Absolute ADR in New Orleans reached $486, which was ahead of what Las Vegas recorded last year ($406). Keep in mind, however, that Las Vegas hotel supply is 4.6 times larger than New Orleans and more importantly, there are 10 times more luxury class hotel rooms in Las Vegas. Thus, when it comes to ADR, we believe New Orleans saw compression that was not as prevalent in Las Vegas given market size. In addition, Las Vegas, given its casinos, is more like to comp hotel rooms for high rollers, which is less likely in New Orleans.
New Orleans’ Friday/Saturday RevPAR was up 156% on 142% ADR gain. Absolute ADR topped $807 with occupancy at 92.9%. In the New Orleans Central Business District/French Quarter submarket, ADR was just shy of $1,000 with occupancy of 97.4%. More than 10% of reporting hotels in the submarket had ADR above $1,000 over the weekend with nearly half above $500. Results for Super Bowl Sunday will be reported next week.
Another choppy week expected
Next week’s U.S. results will again be choppy due to the inclusion of Super Bowl Sunday and the shift from Las Vegas to New Orleans. Additionally, New Orleans will have difficult comps due to last year’s Mardi Gras when Fat Tuesday fell on Feb. 13, 2024. Given those factors, the week will likely be flat to down again.
China pushes global demand upwards
Global hotel demand, excluding the U.S., jumped 10% during the week of Feb. 2-8 and pushed occupancy to 62.1%, which was the highest level of the year so far. ADR increased 2.4% with RevPAR up 11.1%.
The large jump in hotel demand was a result of China, where the measure increased 38% and accounted for most of the rooms growth globally. The driver was Chinese New Year, which began Jan. 29 and concluded Feb. 12.
Other countries seeing hotel demand growth included Germany, Vietnam, Brazil and France. Nearly two-thirds of the countries tracked on weekly basis saw demand growth.
Among the top 10 largest countries based on hotel supply, demand was up 14.1% because of China. Excluding China, hotel demand was up 1.1% despite strong growth in France, Germany, Italy, and Spain. The reason for the lower demand growth in the group was a steep decrease in Indonesia (-8.7%) as well as declines in Canada, Mexico, and the United Kingdom. The U.K. decrease was due to a shift in a major gaming conference.
RevPAR percentage changes in the top 10 countries ranged from up 25.2% in China to down 10.5% in the United Kingdom. Seven of the 10 countries saw double-digit growth this week.
Holiday spots saw mixed hotel performance results with both Australia/Oceania and the Caribbean reporting flat to down RevPAR. The Middle East was also down due to decreases in Saudi Arabia. The United Arab Emirates was up 4.4%.
Hotels around the world will also see difficult comps next week given that Chinese New Year was a week later last year. The negative impact will last through the week ending Feb. 22.
Isaac Collazo is senior director of analytics at STR. Chris Klauda is senior director of market insights at STR.
This article represents an interpretation of data collected by CoStar's hospitality analytics firm, STR. Please feel free to contact an editor with any questions or concerns. For more analysis of STR data, visit the data insights blog on STR.com.