U.S. Hotel Growth Takes a Hit – But Shows Signs of Steadying

The new hotel forecasts are down but come as there is a lot more optimism than there was just a couple of months ago.

CoStar Group, which tracks about 85,000 hotels worldwide, downgraded its U.S. hotel industry growth projections for 2025, citing first-quarter underperformance and mounting economic uncertainty.

The new forecast comes despite fresh signs of stability after weakness in March and April.

"Top-line performance is still growing even in the current environment," said Amanda Hite, president of STR, CoStar's hospitality data unit, in an interview. "Until consumer confidence improves, however, demand is going to remain softer, especially in the middle- and lower-price tiers."

CoStar, which unveiled the projections Monday at the NYU International Hospitality Investment Conference, cut its 2025 forecast for revenue per available room (RevPAR) growth by 0.8 percentage points and f