Even as it projects lower occupancy amid "soft" corporate transient demand, Lodging Analytics Research & Consulting this week forecast 2026 average daily hotel rates to increase 2.1 percent year over year.
That's an increase from the 1.4 percent 2026 ADR increase LARC forecast in September. "Our 2026 operating outlook has shifted to stronger ADR growth at the expense of demand growth," LARC president and co-founder Ryan Meliker said in a letter to clients.
LARC projects full-year 2026 occupancy to decline 0.9 percentage points year over year, with demand hampered by continuing macroeconomic instability, including the possibility of another U.S. federal government shutdown in January, continued uncertainty about tariffs and President Donald Trump's unpredictability, Meliker wrote.
Corporate transient demand "will also remain soft into 2026, in the face of a challenged job market and economic uncertainty," according to Meliker. "However, group trends are proving more resilient. We estimate that the U.S. convention center booking pace is up 4 percent on a year-over-year basis in 2025, following the 3 percent increase in 2024."
LARC projects full-year 2026 revenue per available room to increase 1.2 percent year over year, up from 0.9 percent in its September forecast.
For full-year 2025, LARC now projects full-year 2025 U.S. hotel occupancy to decline 1.4 percent year over year, compared with a projected 1.6 percent decline in the September forecast. LARC projects the 2025 U.S. ADR to increase 0.9 percent from 2024 levels (compared with 0.8 percent in September) and revenue per available room to decline 0.5 percent (compared with 0.7 percent in September).
RELATED: LARC's September forecast