Skift Take
The hotel industry has once again become like that friend who always says they’re “fine” when you ask how they’re doing. It could always be better. It could always be worse.
The global hotel industry is experiencing varied performance across regions in 2024, with some markets thriving while others struggle.
A report by CBRE Hotels Research painted a picture of an industry facing modest pressures from economic uncertainty, changing travel patterns, and increased competition from alternative accommodations.
However, few areas are seeing significant losses. Here are some highlights from CBRE’s report.
U.S. Softening
- CBRE revised its forecast for growth in U.S. revenue per available room to just 1.2% for the full year. In February, it was projecting 3% and had already cut the forecast to 2% in May.
- International tourism and limited supply will offset weakening demand because of softness in some parts of the economy.
- Urban and airport hotels are set to outperform, while resort locations underperform relative to the boom they enjoyed coming out of the pandemic.
- A lack of new supply is helping support prices. For 2024, CBRE expects supply growth of just under 1%, with hotel supply projects to have a compound annual growth rate of 0.9% over the next three years.
European Hotel Resilience
- Europe’s revenue per available room growth is expected to decelerate to around 5% for the full year.
- Key gateway cities are forecasted to see healthy growth, driven by international visitors (especially American vacationers) and corporate travel.
- Major events, such as Taylor Swift concerts, the 2024 Olympics in Paris, and the UEFA EURO 2024 sports matches in 10 German cities, bolstered incremental demand.
Gulf State Hotel Strength
- UAE’s revenue-per-available room soared 30% above 2019 levels during the first half of the year.
- Saudi Arabia saw its revenue per available room rise 44% above pre-pandemic levels in the first half.
- However, geopolitical trends for the remainder of the year in the rest of the Middle East remain uncertain.
Asia Pacific Rebound
- All markets except Maldives achieved RevPAR growth as of mid-2024, with occupancy levels still below 2019 averages.
- Overall, the region’s hotels faced continued challenges related to aircraft shortages. But that problem may fade with time. The airplane passenger count is estimated to jump 17.4% this year and 12.1% in 2025, according to Asia Pacific figures from the International Air Transport Association.
Headwinds to Watch
- A potential regional war could impact tourism in Israel and surrounding countries.
Accommodations Sector Stock Index Performance Year-to-Date
What am I looking at? The performance of hotels and short-term rental sector stocks within the ST200. The index includes companies publicly traded across global markets, including international and regional hotel brands, hotel REITs, hotel management companies, alternative accommodations, and timeshares.
The Skift Travel 200 (ST200)Â combines the financial performance of nearly 200 travel companies worth more than a trillion dollars into a single number. See more hotels and short-term rental financial sector performance.
Read the full methodology behind the Skift Travel 200.
