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As uncertainty weighs on the economy, softening lodging industry growth expected to continue

Following a weak first quarter, the US economy strengthened in Q2.

  • An initial second quarter GDP estimate of 2.7 percent and further solid contributions from consumer spending suggest that the US economy will remain on solid footing for the balance of 2017.
  • Overall, moderate demand growth in Q2 supported increases in both occupancy and ADR, resulting in a RevPAR increase of 2.7 percent.

Despite ongoing political uncertainty, consumer and business spending are expected to continue to support economic growth in the second-half of 2017.

  • Benefiting from rising employment, real disposable income, and household wealth, consumers have been a driving force of economic growth this cycle.
  • For the lodging industry, an increase in domestic spending is expected to help support growth in demand, though supply growth continues to be a meaningful downside risk.
  • ADR growth of 2.1 percent is expected to continue to outpace inflation, resulting in a 2.3 percent increase in RevPAR in 2017. 

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About Hospitality Directions

PwC Hospitality Directions US is a near-term outlook for the U.S. lodging sector, commonly used by industry decision-makers and stakeholders to better understand the impact of policy and other macro-environmental factors on the sector’s operating performance. Our outlook includes metrics for the overall sector as well as for the chain scales, and is used by our clients for strategic planning and capital allocation purposes.

• demand and supply
• occupancy 
​• average daily rate 
​• revenue per available room 

Contact: Scott Berman

+1 (305) 375 6210

Contact: Warren Marr

+1 (267) 330 3062

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