STR, TE lower projections in final 2024 forecast

STR AND TOURISM Economics downgraded their growth rate forecast for the U.S. hotel business with their final revision of 2024. The forecast for next
year remains uncertain as the impact of the presidential election becomes clear.

For 2024, projected gains in ADR and RevPAR were each downgraded, down 0.5 percentage points to 1.5 percent growth for ADR and with RevPAR’s projected growth
dropping 0.6 ppts to 1.4 percent, respectively. Occupancy for the year was lowered 0.1 ppts to 62.9 percent, after the previous forecast projected the metric
to remain steady from 2023. For 2025, the occupancy growth projection was downgraded 0.4 ppts, and the forecast for ADR and RevPAR increases were lowered
to 1.6 percent and 1.8 percent, respectively.

“The outlook for 2025 remains somewhat in flux, with positive sentiment potentially offset by the higher cost of living,” said Amanda Hite, STR president.
“Based on current economic conditions, higher-end hotels will continue to drive industry performance. The change in the presidential administration is
anticipated to yield stronger economic conditions at first, which is not yet reflected in the data.”