San Francisco’s lodging market continues to surge with record double-digit RevPAR growth driven by growth in average daily rates. It ranks 3rd in the nation for occupancy rate. Year-over-year occupancy was up nearly 3% and ADR increased over 9% in 2013, leading to a RevPAR increase of more than 13% as compared to the prior year. San Francisco County saw $876 million in transaction activity in 2013, up from nearly $750 million in 2012.
San Francisco is a major hub for tech and biotech employment, a popular tourist destination, a significant cultural leader, and an important gateway to the Asia/Pacific region. As such, the city is a considerable draw for leisure, group, and convention guests. Its hotel stock tends be older, due to very limited hotel development since the 1980s, and clusters in five general districts near demand generators. Full service hotels and conversions to lifestyle boutique hotels are predominantly grouped around Union Square and the Financial District.
South of Market (SoMa) is the home of the city’s convention center and has seen the most new development over the past two decades. The tourist beacon of Fisherman’s Wharf contains primarily branded hotels, of which a select few are also undergoing major renovations/rebrandings. Finally, the Lombard Street/Van Ness Corridor features mostly limited-service hotels and value motels.
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