Demand growth tapers as supply growth reaches 2%

  • Hotel demand grew 3.0% nationally in Q1 2018, down from the 3.7% rate in Q4 2017. Supply growth rose to 2.0%.
  • Of the markets tracked by CBRE Hotels’ Americas Research, Pittsburgh had the largest year-over-year demand increase (11.7%). High gains also occurred in Houston (11.4%), still recovering from Hurricane Harvey, and Philadelphia (11.3%).
  • National occupancy rose by 0.9% year-over-year, continuing a trend of setting new highs in quarterly occupancy levels.
  • ADR grew by 2.5% nationally in Q1, up from 2.4% in Q4 2017 but down from 2.6% in Q1 2017. RevPAR grew by 3.5% year-over-year in Q1 2018, the same pace as in Q1 2017.
  • 31 of the 60 markets tracked by CBRE Hotels’ Americas Research had supply gains of more than 2% in Q1, about the same as in Q4 2017. 31 markets also had declines in occupancy, seven more than in Q4 2017.
  • A 4.3% increase in occupancy and 18.6% increase in ADR gave Super Bowl LII host city Minneapolis the largest increase in RevPAR (23.8%) in Q1. Miami (16.6%) and Philadelphia (13.5%) also had high RevPAR gains.
  • Of the top-10 markets for RevPAR growth, only Newark and Philadelphia saw increases driven primarily by occupancy.