PwC Hospitality Directions US

PwC Suggests Continued Momentum into 2019 for U.S. Hotels

Compelling economic fundamentals, combined with an increase in commercial transient demand, suggests continued momentum into 2019.

Following a better than expected first quarter, lodging metrics continue to remain positive.

  • First quarter results yielded stronger than expected increases in demand for many hotel companies, as well as slightly stronger rate growth, driven primarily by an increase in commercial transient travelers.
  • Year-over-year for the first quarter, RevPAR increased across the transient segment nationally, led by rate growth. As hotels continue to feel the pressure from rising wages, insurance costs and other expenses, the components of RevPAR growth become more important.
  • With occupancy levels at record levels, an expected uptick in commercial transient demand midweek should bode well for stronger increases in room rates.
  • Looking ahead to 2019, there is an expectation of gradual strengthening in rate growth as we move through the year.

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