Good news, bad news with ALIS data

LOS ANGELES – Here’s the good news coming out of Day 1 of the Americas Lodging Investment Summit (ALIS): the newly released CoStar and Tourism Economics 2026-2027 U.S. hotel forecast moves the industry back from red to black ink this year with a projected .2% dip in occupancy and a 1.0% increase in ADR equating to 2026 RevPAR growth of 0.6% versus a 2025 RevPAR decline of 0.3%. The bad news: not everyone on stage at ALIS for “The Numbers” panel sees it that way. Kalibri’s Cindy Estis Green forecasts a 1.5% decline in occupancy and a .5% increase in rate equaling a 1.0% dip in RevPAR for 2026.

Looking a little deeper at the STR data, bifurcation is expected to continue with luxury properties projected to be up 3.2% year-over-year, upper upscale up 1.6%, while limited-service will be around -1%. Midscale is projected to come in around -1% and economy closer to -2%.

Kalibri said while the forecast -1.5% RevPAR decline, their upside is +1%, creating a midpoint at -0.25%.

Any way you want to slice it, uncertainty reigns with macro unpredictability and turbulence never being a recipe for success as discretionary travel always seems to suffer during uncertain times, according to Estis Green.

STR’s Isaac Collazo stated another truth: pressure on margins will continue as inflation outpaces rate growth. Collazo added that rate growth isn’t as robust as online travel agencies take share, corporate rate growth is flat and because a lion’s share of the volume is coming from the lower end of the market.

Back to the good news: the sky isn’t falling and it is up to owners and operators to make demand more profitable by better managing yield.

On supply growth, CoStar and Tourism Economics lowered their 2026 projections by 0.2 ppts, while demand was reduced by 0.1 ppts.

Collazo said construction will not widen in 2026 as the supply game remains mostly about conversions. He added that while there are still plenty of rooms in the pipeline, news construction only accounts for 19% of the entire pipeline – its lowest level since 2011 – with no signs of pending change in the new construction environment.

Back to performance, STR President Amanda Hite said in the STR/Tourism Economics release, “We expect top-line performance to strengthen in the second half of the year, although growth will remain moderate and concentrated among higher-tier hotels. The early months of that period will be highlighted by notable gains in World Cup host markets and their surrounding areas. In addition, calendar shifts will provide a lift, especially as we move past the elevated comparables from the 2024 hurricane-affected markets.”

Growth rates are projected to rise further in 2027, but even the forecasted 1.4% increase in RevPAR would remain below the long-term average (+3.0%).

“We expect a more supportive backdrop for U.S. travel in 2026,” said Aran Ryan, director of industry studies with Tourism Economics. “While a softer job market weighs on younger and lower-wage households, real wage gains and household wealth should keep consumer spending resilient. Business investment will broaden beyond AI as borrowing costs ease and tax incentives support new projects. International travel faces near-term headwinds but will likely see a gradual rebound as global demand strengthens and the World Cup boosts summer arrivals.”

“Total revenues are expected to rise at a faster pace than last year, while expenses should follow a similar trajectory—though at a slower rate of growth than in 2025,” Hite added. “Even so, expense growth will continue to outpace inflation.”