First-quarter 2026 U.S. extended-stay hotel demand, measured by total room nights sold, increased 5.4 percent year over year, the largest quarterly increase since 2022, according to a new report by The Highland Group.
"Generally in line with the broader hotel industry, the end of Q1 2026 marked a five-month trend of accelerating extended-stay demand," according to the report.
Demand also increased year over year and hit record highs across all three service tiers: 3.2 percent in upscale, 7 percent in midprice and 6.4 percent in economy.
First-quarter overall occupancy rose 0.7 percentage points year over year to 71.3 percent. Occupancy increased across all three service tiers: 0.8 percentage points in upscale, 0.5 percentage points in midprice, 1.1 percentage points in economy.
Revenue per available room increased 1.1 percent to $84.69, breaking a three-quarter streak of RevPAR declines. First-quarter average daily rate increased 0.4 percent year over year to $118.71, and only the economy tier recorded a rate decline, down 2 percent to $58.45.
Supply, as measured by total room nights available, increased 4.6 percent year over year to 57.2 million. Supply also grew across all three service tiers: 2.4 percent for upscale, 6.4 percent for midprice and 5.3 percent for economy.
Supply in future quarters is expected to "continue to plateau or tick down as extended-stay rooms under construction have been falling and relatively high interest rates are likely to continue during the foreseeable future," according to the report.