U.S. hotel supply grew 2.1 percent in July to outpace the 1.9 percent increase in demand, according to STR. This slowed growth of ADR and, subsequently, RevPAR for the month.

OCCUPANCY FOR U.S. hotels dropped some in July, but ADR and RevPAR continued to grow, albeit slowly, according to STR. Demand was high over the summer, but it was met by supply growth that muffled performance overall.

Occupancy dropped 0.2 percent from July 2017 to 73.6 percent while ADR rose 2 percent to $133.44 and RevPAR grew 1.8 percent to $98.17, making July the 101st consecutive month for RevPAR year-over-year growth. Supply grew 2.1 percent, faster than the 1.9 percent increase in demand, said Jan Freitag, STR’s senior vice president of lodging insights.

“The heart of the summer vacation season helped the industry establish an all-time record in demand, which topped 120 million room nights sold for the first time in history,” Freitag said. “However, there was enough supply growth to outpace the year-over-year increase in demand, and that led to the first monthly occupancy decrease in the U.S. since last July. That, combined with just a 2 percent lift in ADR, produced our lowest RevPAR increase since April 2017.”

STR does expect demand to continue rising through 2019.

Houston, Texas, reported the largest rise in RevPAR, up 12.3 percent to $61.26, stemming partially from the second-highest rise in occupancy, up 5.0 percent to 61.8 percent. The highest increase in occupancy, up 6.6 percent to 60.1 percent, gave Phoenix, Arizona, the only other double-digit increase in RevPAR, a rise of 10.2 percent to $51.96.

San Francisco/San Mateo, California, posted the largest lift in ADR, up 9 percent to $256.50. On the downside, Washington, D.C.-Maryland-Virginia, saw the steepest declines in ADR, dropping 2.6 percent to $139.95, and RevPAR, down 4.8 percent to $108.10. Occupancy dropped 5.2 percent to 76.3 percent for Miami/Hialeah, Florida, largest decrease in that metric, followed by a 3.6 percent drop in occupancy to 71.3 percent for St. Louis, Missouri-Illinois, coupled with a 3.5 percent decline in RevPAR to $77.13.