STR Weekly Insights: 10-16 August 2025

Analysis by Chris Klauda and Isaac Collazo

All financial figures in U.S. dollar constant currency. 

Highlights

• Anemic U.S. RevPAR expected to continue through the end of summer 
• Negative weekdays in the Top 25 Markets reflect stalled business travel 
• Economy hotels causing demand decline, exacerbated by Houston
• Canada posted 10th straight week of RevPAR growth

Another week of lackluster RevPAR as the end of summer nears

U.S. hotel revenue per available room (RevPAR) fell 0.5% for the week ending 16 August with significant influence from the difficult year-over-year comps in Houston. Houston, which accounted for 5 basis points of the national RevPAR decrease, was not alone as 47% of all markets saw RevPAR decline by more than half a percentage point—the most of the past four weeks. Falling occupancy drove the nationwide RevPAR decline, while average daily rate (ADR) rose a mere 0.4%. 

Top 25 Market slowdown reflects stalled business travel

Slowing weekday occupancy, particularly in the Top 25 Markets (T25) had the largest impact on the week. Business travel, which is best represented in weekday performance, has plateaued. Leisure travel continued, as evidenced by strong weekend performance, however, it was not enough to carry the industry.

Weekday occupancy declined 0.7ppts with ADR up only 0.3%, reducing RevPAR by 0.9%. Weekend RevPAR advanced 0.3% on ADR (+0.6%) as occupancy dipped 0.2ppts. Notable differences appeared across the Top 25 Markets compared to all other markets. Weekday RevPAR in the T25 Markets fell 2.3%, and weekend RevPAR fell 1.3% with occupancy the primary culprit. Overall, T25 weekly RevPAR dropped 2%. Excluding Houston, weekly RevPAR was down 0.9% overall with negative weekday comps (-1.3%) and a flat weekend. 

RevPAR was somewhat better in other non-T25 metro areas with weekday and weekend RevPAR up 0.2% and 0.3%, respectively. For the week, non-T25 advanced 0.2%. Non-metro/rural areas posted the largest weekly gain (+0.7%) with the weekend advancing 1.9% and weekdays flat. 

Summer’s end is nearing

This has been the weakest summer of the past four years, and we only have two more weeks left of the 2025 summer travel season. Demand is down 1.4 million room nights compared to the same period last year. RevPAR has declined 1.1% on occupancy with ADR up just 0.2%. The demand retreat has come mostly from Economy hotels, with 45% of its decline centered in 10 markets (in order), including: Houston, Las Vegas, Los Angeles, Arkansas Area, Texas South, Myrtle Beach, and New Jersey Shore. Houston and Las Vegas account for nearly a quarter of the Economy hotel decrease. Midscale and Upper Upscale class hotels have also seen a decline over the summer, but to a lesser extent and only make up 20% combined of the total room nights lost this summer. Luxury, Upscale, and Upper Midscale have all gained about the same number of room nights this summer (~438,000 each), but their combined growth was insufficient to offset the decreases from the other classes.

Top 25 down over the past four weeks

Top 25 Market performance has been suffering for much of the summer, and the most recent week was no exception. Of the 16 markets seeing RevPAR decline, all but Tampa have seen RevPAR decrease over the past four weeks. Excluding Houston and Las Vegas, the remaining Top 25 Markets in total remained in arrears over the past four weeks due to declining occupancy and a barely positive ADR comp.

• Houston’s weekly RevPAR dropped 27.1% due to the difficult 2024 storm-elevated comps. One bright spot for Houston was positive Group demand, which advanced 24.6% with Group ADR rising 34.0%.The market’s central business district (CBD) was the primary beneficiary while the rest of Houston’s submarkets declined. Over the past four weeks, RevPAR for the entire Houston market is down 28.2% on retreating occupancy.
• New Orleans also has difficult 2024 comps. Last year, it was among the top five performing markets nationwide during this period. RevPAR over the past four weeks is down 14.5% on occupancy. 
• Las Vegas, which has seen persistent decreases, was still down, but to a lesser extent. Over the past four weeks, RevPAR declined 5.2%.

Bifurcation holds with Economy hotels impacted the most

Luxury hotels posted healthy gains even as the rest of the industry slows. Luxury RevPAR rose 4.4%, from a combination of ADR (+2.9%) and occupancy +0.9ppts. Upper Upscale posted a flat RevPAR comp as ADR gains were offset by occupancy declines due increasing supply. Persistent supply gains have also impacted occupancy in Upscale and Upper Midscale along with falling ADR. Midscale, which saw supply outstrip demand gains too, had a larger ADR decline. Weekly RevPAR for the three ranged from -1.3% in Upscale to -2.3% in Midscale. Economy fell 4.3% due to a sharp ADR decrease (-3.1%) along with falling occupancy. As noted already, Houston is having an impact, and it is felt particularly in Economy hotels. Excluding Houston, Economy performance is still down, however much less severe at -2.1% with ADR having the largest impact (-2%).

Unstoppable Canada 

Global RevPAR, excluding the U.S., increased 4.2%, lifted by ADR (+2.4%) and occupancy rising 1.3ppts. Six of the top 10 countries advanced, led by Japan and Canada. These two countries have held the top two spots for the past four weeks. Canada has reported solid performance all summer and has seen RevPAR growth for the past 10 weeks, with the measure increasing 8.3% in the most recent period. Since the start of Summer, Canadian RevPAR has increased 7.7%

• China saw positive a RevPAR comp (+1.3%) for the first time since mid-May. The week’s gain was a function of both ADR (+0.6%) and occupancy (+0.6ppts).  
• U.K. RevPAR slowed (-2.2%), partly due to a Taylor Swift comp last year. 
• Germany and France continued to face tough sports comps (EURO, Olympics) from last year, causing RevPAR declines 11.8% and 30.0%, respectively, both on falling ADR.

Looking ahead

The next couple of weeks through Labor Day are expected to see more of the same. With schools in session across much of the country, leisure travel will continue to slow, and business travel is unlikely to fill in the gap during the fortnight. The impact of Hurricane Erin will be seen in next week’s results along with continued headwinds from Houston’s storm comps. Chicago will see a slowdown impacted by the comp to the 2024 Democratic Convention. Difficult comps from Hurricane Helene and Milton are also on the horizon.