STR Weekly Insights: 4 - 10 May 2025

Analysis by Isaac Collazo, Chris Klauda

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

Highlights

• U.S. RevPAR retreats via the weekend and Top 25 Markets
• Group demand held and drove U.S. Luxury RevPAR growth
• Global RevPAR trending strong
   

Weekend nights pushed RevPAR retreat

Following two weeks of year-over-year (YoY) growth, U.S. revenue per available room (RevPAR) fell 2.7% for the week ending 10 May. The decline was primarily on occupancy, which was down 2.3 percentage points (ppts). Average daily rate (ADR) dropped a modest 0.6%. The weekend (Friday & Saturday) showed the largest decline with RevPAR down 4.0% as both occupancy (-1.6ppts) and ADR (-1.8%) retreated. Weekdays (Monday-Wednesday) were the least negative with RevPAR declining 2.3% totally on occupancy, while shoulder days (Sunday & Thursday) saw RevPAR decrease 2.9%.

T25 Markets flipped from the previous week

An about-face occurred with the Top 25 Markets (T25) suffering the largest losses after posting the highest gains in the prior week. RevPAR declined 4.3% on falling occupancy (-2.6 ppts) as ADR was somewhat flat (-0.7%). RevPAR decreased by more than 3% all seven days. 

Normally, a shift in T25 performance is due to the outsized impact of Las Vegas. While the country’s largest hotel market was down for the week (-8.4%), the T25 aggregate would have been down even if Vegas was excluded.

Among the T25 markets, San Francisco saw the largest decline due to the calendar shift of the RSA conference. RevPAR dropped in the majority (17) of the T25 markets with eight of the 10 largest markets experiencing declines ranging from -33.9% in San Francisco to -2.1% in Dallas. Overall, many markets were impacted by event calendar shifts. Excluding both Las Vegas and San Francisco, 63% of the industry’s total demand decline was in the remaining T25 Markets. 

On the other side of the spectrum, major markets seeing healthy gains included Philadelphia (+18.5%), which benefited from strong Group business over the past two weeks. Boston advanced +15.5% with all six submarkets posting double-digit gains on the heels of a prior negative week. Rounding out the list was Nashville (+9.3%) with strong performance Sunday through Tuesday, particularly in the CBD submarket, and Tampa (+7.5%).

Next 25 (N25) largest markets held RevPAR

Across the next 25 largest markets, the RevPAR comp was essentially flat -0.4%. Three of those markets saw strong RevPAR gains led by Pittsburgh (+34.5%), Columbus, (+29.8%) and Salt Lake City (+28.6%). Columbus reflected a shift in Ohio State’s graduation ceremony, which was held a week later than last year. RevPAR outside of the 50 largest markets dropped 2.2%. 

Luxury chains unstoppable while other chains decline

Luxury chains continued to post positive RevPAR comps, while the other five chain scales declined, due primarily to occupancy declines. Like with the total industry, weekends pushed the RevPAR decline with all chain scales down ranging from -2.1% for Luxury to -7.2% for Economy. Luxury chain RevPAR was positive on the weekdays (+3%) and flat on the weekend. All other chains scales declined on weekdays and shoulder days.

Group business did not retreat

Group demand in Luxury and Upper Upscale hotels was almost flat (+0.5%), and contrary to the weekend softness reported across the industry, it was weekend Group demand (+6.2%) that lifted overall Group. 

Group demand on shoulder days was flat (+0.1%) while weekdays were down (-2.8%). Transient demand for the week was down 1.8%.

Taking a closer look and using comparable reporting hotels across all hotel classes, 90% of the week’s decrease in absolute room demand came from Transient. A week ago, both Transient and Group were up with Group accounting for 63% of the growth. On a percentage basis, the decline in Transient demand was nearly identical in the Top 25 Markets to that of the remaining markets (~-2%). In the previous week, Transient demand was up. The two weeks combined saw Transient demand flat (-0.1%) whereas group demand was up 4.3%.

Weekend Transient demand among comparable hotels fell by 2.3% with Group demand up 2%. The increase in weekend Group demand was led by Luxury and Upper Upscale hotels, where it rose by more than 5%.

Continued healthy global RevPAR

Global RevPAR advanced 7.8%, continuing its growth run, increasing over 7% for five of the past six weeks. 

• Four of the top 10 largest countries saw double-digit RevPAR growth with Japan and Mexico in the top four as they have been for most of the year. 
• Germany saw strong performance with standout results in Frankfurt, Munich and Stuttgart. Nine of Germany’s 13 markets reported positive RevPAR changes. 
• India also posted RevPAR gains across almost all markets with the exception of India North, possibly the result of the recent miliary strikes. 
• RevPAR in Canada advanced across 14 of the country’s 22 submarkets with the three largest cities posting significant gains: Toronto (+18.6%), Montreal (16.2%) and Quebec City (8.1%).  
• France experienced a RevPAR decline partially due to the difficult comparison to last year when Taylor Swift performed in Paris.
• China’s RevPAR (-3.2%) fell slightly more than in the previous week driven by Upper Midscale, Midscale and Economy hotels. 

Looking ahead

The slowdown this week was a surprise—there have been many this year. While there were some calendar shifts, nothing obvious stood out. Could it be a reversal from the strong prior week or is this the beginning of the anticipated impact from the increased economic uncertainty due to policy changes? 

TSA airport screenings were also down this week, and the first reading of the upcoming week (Sunday through Wednesday) showed continued slowness. Recall, the school calendar for K-12 grades shifted due to the late Christmas holidays and the late Easter, which may also be playing a role. 

Only time will tell but forward booking data in the Top 25 Markets looks good for the rest of May and June.  
Globally, the industry remained strong and didn’t appear to be slowing. U.S. outbound travel continued to rise while inbound travel moderated.