Occupancy was increased by 0.1 ppt to 63.1 percent
CoStar and Tourism Economics made minimal adjustments to their 2025 U.S. hotel forecast, with ADR and RevPAR gains unchanged at 1.6 percent and 1.8 percent, respectively, while occupancy rose by 0.1 ppt to 63.1 percent.
By Vishnu Rageev RJan 30, 2025
COSTAR AND TOURISM Economics made minimal adjustments to their growth forecast in the first 2025 U.S. hotel forecast, with ADR and RevPAR gains unchanged at 1.6 percent and 1.8 percent, respectively. Occupancy for the year was raised by 0.1 ppt to 63.1 percent.
“While business optimism is on the rise, economic data has not changed significantly from our previous forecast,” said Amanda Hite, STR president. “The stronger performance seen in the fourth quarter was driven by one-time factors, including holiday travel compression and weather-related events, and does not constitute a change in trend. Additionally, the impact of the new administration has not been factored into the forecast, as significant policy changes have yet to be implemented, and any projected effect of those changes remains unclear. Thus, our forecast is relatively unchanged overall with minor tweaks among the chain scales. Based on current economic conditions, we expect higher-end hotels to continue to drive industry performance.”
Aran Ryan, Tourism Economics' director of industry studies, said 2025 economic conditions are expected to support travel activity, including some actions by President Trump.
“Unemployment is low, inflation is slowing, consumers are spending - particularly those in higher income households, and business investment activity is solid," Ryan said. "Trump administration trade and immigration policy priorities present downside risks, particularly to inbound travel (e.g., through trade war responses, visa impediments, charged rhetoric and general border and policy uncertainty)."
Hite said normalized expense growth and a slight increase in TRevPAR are expected to drive profits in 2025.
“Labor costs are forecasted to stabilize in 2025 as hotels have adjusted operations to current labor trends, and these lower labor margins will allow for slightly better GOP margins,” she said. “With continued growth in groups and business travel, F&B departments are expected to report some of the highest growth rates this year. Rooms and undistributed operating expense growth will moderate, though utilities departments will almost certainly see increases.”
In November, STR and TE downgraded their 2024 growth rate forecast for the U.S. hotel industry.
Four Seasons, Fort Partners and Merrimac Ventures plan a mixed-use project in Telluride, CO.
The project is in Mountain Village near the San Juan Mountains.
Florida-based Fort Partners and Merrimac Ventures are led by Nadim Ashi and Dev Motwani.
FOUR SEASONS, FORT Partners and Merrimac Ventures are jointly developing the Four Seasons Resort and Residences Telluride in Telluride, Colorado. The project includes 52 guestrooms, 43 hotel residences and 26 private residences for short-term and permanent stays.
The properties are being developed in Mountain Village near the San Juan Mountains in Colorado, Four Seasons said in a statement.
Toronto-based Four Seasons is led by CEO Alejandro Reynal, while Florida-based partners Fort Partners and Merrimac Ventures are led by founder Nadim Ashi and President and CEO Dev Motwani, respectively.
“This achievement would not have been possible without the support of local partners like Telluride Ski & Golf, the Town of Mountain Village and TMVOA,” Motwani said. “We are fortunate to inherit this site and build upon the work they’ve already done.”
Bart Carnahan, Four Seasons’ president of global business development, portfolio management and residential, said the company is offering a new opportunity for guests and residents to enjoy a ski destination.
“Fort Partners and Merrimac Ventures are ideal collaborators, with a deep understanding of the destination, Four Seasons’ legendary service and a shared commitment to creating experiences for both short-term visitors and residents,” he said.
“Telluride is a place of extraordinary heritage and beauty and represents a rare opportunity to create something lasting,” Ashi said. “Together with Four Seasons and Merrimac, we are creating a landmark that reflects this legacy, honors its natural beauty and endures for generations.”
Sonesta International Hotels Corp. recently launched Americas Best Value Studios by Sonesta, an extended-stay version of its franchised brand, Americas Best Value Inn.
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