The 2.6 percent rate growth helped RevPAR to bounce up 2.4 percent over the prior year.

U.S. HOTELS CAME through 2018 in good shape despite concerns about the economy, according to HotStats. But they’ll have to maintain discipline to achieve similar performance this year, according to the head of the research company.

The U.S. Annual Hotel Performance Tracker 2019 shows a 3.4 percent increase year-over-year to $97.87 in profit growth or GOPPAR and an increase of 2.9 percent year-over-year to $259.10 in TRevPAR.

The 2.6 percent rate growth helped RevPAR to bounce up 2.4 percent over the prior year. However, occupancy recorded a slight drop of 0.1 percent points over 2017 to 77.2 percent.

The revenue through food and beverages increased 2.8 percent YOY on a per-available-room basis. Profit margins for the year were up 0.2 percentage points to 37.8 percent of total revenue.

“Despite some challenges, hoteliers in 2018 did an admirable job on both the revenue and expense side, which showed up positively in the bottom line,” said HotStats CEO Pablo Alonso. “In order to continue the momentum in 2019, hoteliers will need to be cost conscious and revenue focused in order to maximize flow through.”

The report finds growth in leisure volume mix from 0.2 percentage points to 24.4 percent as a sign that both domestic and international travelers see the U.S. as a viable leisure destination. However, even after President Trump’s tax reform plan, corporate demand in 2018 dropped by 0.2 percentage points.

Payroll costs increased 0.2 percentage points over the year prior to 34.9 percent.

Washington, D.C., couldn’t maintain the huge profit growth it made during President Trump’s inauguration and residency in 2017. The city saw a large decline in 2018 GOPPAR, down 10.8 percent to $97.37. Houston hotels clinched profitability in 2018, an achievement the city couldn’t match in consecutive years prior.

The STR report, published in January, called 2018 as another record-breaking year for the U.S. hotel industry.