The latest data from CoStar, a leading provider of real estate analytics, paints a challenging picture for the US hotel industry for the week ending July 26, 2025. Despite recovery signs in certain markets, the overall year-over-year performance indicates slight declines in key metrics such as occupancy, average daily rate (ADR), and revenue per available room (RevPAR). These results reflect a mix of ongoing challenges in the hospitality sector, as well as regional variations across the country.

The overall trend of negative growth in hotel performance for the week compared to the same period in 2024 highlights the ongoing uncertainty facing the industry. However, the report also sheds light on specific markets, such as St. Louis, which recorded positive movement, contrasting the general trend. This article will delve into the details of the data and explore the implications for both hotel operators and travelers.

US Hotel Industry Performance Overview
For the week ending July 26, 2025, the US hotel industry experienced slight declines in all key performance metrics compared to the same week in 2024. The following are the reported figures for occupancy, ADR, and RevPAR:

• Occupancy: 71.5% (-0.7%)
• Average Daily Rate (ADR): $164.88 (-0.1%)
• Revenue per Available Room (RevPAR): $117.88 (-0.8%)

These figures indicate that while the hotel industry continues to experience a relatively strong level of occupancy, the overall revenue generated per available room remains under pressure. The decline in ADR by 0.1% and RevPAR by 0.8% suggests that hotels are still grappling with pricing pressures, particularly as travelers remain cautious about their spending.

Despite the slight year-over-year declines, the overall occupancy rate remains relatively healthy, indicating that demand for hotel accommodations is still stable, albeit with less momentum than in previous periods. However, challenges persist, especially in markets that are struggling to recover from unique regional disruptions.

St. Louis: A Bright Spot Amid the Decline
While many US markets have seen a decline in key performance metrics, St. Louis stands out as a notable exception. The city reported the highest occupancy increase among the Top 25 Markets for the week, with a 5.7% year-over-year rise in occupancy, bringing the rate to 70.9%. This increase can be attributed to a combination of factors, including targeted marketing campaigns, local events, and the city’s growing appeal as a mid-sized destination for both business and leisure travelers.

St. Louis has been positioning itself as a vibrant hub for tourism, with increased efforts to attract more visitors through cultural and recreational offerings. The strong occupancy growth in the city suggests that these efforts are beginning to pay off, as it bucks the overall downward trend seen across much of the US hotel industry.

The performance of St. Louis highlights the importance of localized factors in the hotel industry. While national trends may show overall stagnation or slight declines, specific markets are capable of outperforming the broader trends due to strategic initiatives, favorable local conditions, and the adaptability of hotel operators.

Houston: A Struggling Market
On the opposite end of the spectrum is Houston, which recorded the steepest declines in all three major performance indicators. The city saw a significant drop in occupancy, down by 19.7% to 61.1%. The ADR also fell by 7.7%, reaching $117.02, while RevPAR saw the sharpest decline, down by 25.9% to $71.54.

These declines are primarily attributed to the elevated displacement demand that followed Hurricane Beryl in 2024. Many hotels in Houston experienced a surge in bookings due to the temporary displacement of residents and business travelers during and after the hurricane. As the region returned to normal, this temporary spike in demand was not sustained, leading to a sharp decrease in performance metrics.

Houston’s struggles serve as a reminder of how external factors, such as natural disasters and regional disruptions, can significantly impact hotel performance. As recovery efforts continue, it is essential for operators in affected regions to manage expectations and plan accordingly to regain stable occupancy levels.

Regional Variations and Market Adaptations
The US hotel industry is highly diverse, and performance trends can vary significantly from one region to another. In addition to the notable performances in St. Louis and Houston, other markets are showing mixed results. Cities with strong business travel demand, such as New York and Los Angeles, are likely to continue to perform relatively well, while more leisure-focused destinations might experience fluctuations depending on seasonal trends and consumer confidence.

The key to navigating this complex landscape will be for hotel operators to adapt their strategies based on local demand drivers. With the recovery from the COVID-19 pandemic continuing to evolve, it is crucial for hotels to remain agile, adjusting pricing, marketing, and service offerings to meet changing consumer needs.

Looking Ahead: A Challenging Road for US Hotels
The US hotel industry faces a mixed outlook as it continues to recover from the disruptions of the past few years. While key markets such as St. Louis show promising growth, other cities like Houston are grappling with the aftermath of regional challenges. The slight year-over-year declines in occupancy, ADR, and RevPAR indicate that the road to full recovery will be slow and uneven, with some regions bouncing back more quickly than others.

For hotel operators, the focus must remain on improving efficiency, maintaining high service standards, and responding swiftly to emerging trends. Additionally, keeping track of local market conditions will be vital for adapting to the demands of travelers in a post-pandemic world. As the industry continues to adjust to changing travel patterns, operators will need to stay ahead of the curve by focusing on delivering value to their guests while managing operational costs.

Conclusion
The latest data from CoStar paints a picture of a hotel industry in transition, facing both challenges and opportunities. While national trends indicate slight declines in key performance metrics, specific markets like St. Louis show that targeted strategies and regional initiatives can yield positive results. Meanwhile, cities like Houston remind us that external factors such as natural disasters can have a long-lasting impact on hotel performance.

As the US hotel industry navigates these challenges, the focus must remain on adaptability, efficiency, and customer satisfaction. The ability to respond to local demands and capitalize on emerging trends will be crucial to maintain profitability and sustaining long-term growth. With the hospitality sector continuing to recover, it is clear that the industry is in a period of flux, but the potential for success remains strong in markets that can adjust and innovate effectively.