U.S. Hotels Are Winning on Price, Not on Full Rooms

Hotel analyst HVS says U.S. hotels are heading into a strong fall meeting and convention season, and the engine is price rather than traffic. Its October 2026 market pulse, published October 21, points to higher average daily rates as the main driver, helped by demand for luxury and upper-upscale rooms.

Occupancy tells a different story. September and October normally run at 67 to 69 percent before the pandemic, and HVS puts current levels about one point below that range. Even after accounting for new supply, occupancy still trails 2019 by roughly two points, and the firm expects that gap to linger for a while.

That does not mean fewer guests overall. HVS expects occupied room nights in 2026 to exceed the 2019 level. It also expects rate growth to slow in November and December, and RevPAR growth to moderate slightly in 2027, with modest gains in both rate and occupancy by the end of that year.

The report also touches the business side of the industry. Hotel transactions and refinancing are busy, and HVS expects capitalization rates to rise because of higher interest rates, though strong RevPAR could offset that for hotel values. Managers are leaning on staffing companies and outsourcing for departments such as valet, housekeeping and banquets, a trend HVS expects to continue through the decade.

Sources: HVS via Hospitality Net