CoStar, Tourism Economics raise U.S. hotel growth forecast

Why this matters

The upward revision of the U.S. hotel growth forecast by CoStar and Tourism Economics signals a potential shift in investor sentiment within the hospitality sector. An increase in Revenue Per Available Room (RevPAR) suggests a strengthening demand environment, buoyed by the addition of over eight million room nights year-on-year. This growth in supply, while indicative of a recovery trajectory, also raises questions about market saturation and competitive pressures. For institutional investors, this forecast may influence capital allocation strategies, particularly as the hospitality sector continues to recover from pandemic-induced disruptions. However, the acknowledgment of ongoing expense growth highlights a critical concern: profit margins may remain under pressure, complicating the investment thesis. The interplay between rising demand and escalating operational costs could lead to a bifurcation in performance among hotel assets, necessitating a more discerning approach to underwriting and asset selection. As capital flows into the sector, stakeholders will need to assess not only the potential for revenue growth but also the sustainability of profit margins in a competitive landscape. This nuanced understanding will be essential for navigating the evolving dynamics of U.S. commercial real estate.

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On the RET wire

• Disclosed hospitality deal value tracked in June 2026: $3.8B across 20 reported transactions. All Hospitality coverage →
• 12 stories mentioning CoStar on the wire in the past 90 days. CoStar coverage →

Computed from Real Estate Trail’s own tracked coverage

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