CoStar's STR reported that U.S. hotel demand declined for a third straight week from June 8-14, 2025, at a time when the early-summer travel season was expected to boost performance. This trend indicates a softening in the hospitality sector.
The steepest declines in demand were observed in the Mountain and West South Central regions, with Las Vegas and Houston accounting for 32% of the absolute room demand decline among all markets reporting losses. Conversely, 61 of 172 U.S. markets experienced June month-to-date demand gains, led by Chicago, Nashville, Oklahoma Area, Orlando, and Saint Louis.
Average daily rate (ADR) growth has also softened, particularly in the select-service segments, with ADR growth converging with demand near 0% in Upscale and Upper Midscale segments, and declines in Midscale and Economy. International arrivals were down 3.1% over the first five months of 2025, contributing to the overall demand challenges.
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