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Quarterly Update: Hotels

Published on 4/29/24


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Houston hotel occupancy dipped in March ’24 compared to March ’23. This led to a decline in revenue per available room (RevPAR). The average daily rate (ADR), another metric of financial health, was flat compared to last year and declined when adjusted for inflation. However, occupancy, RevPAR, and ADR should improve in ’24 as corporate travel returns and construction of new hotels taper off.

Hotel occupancy fluctuates throughout the year, dropping to the low 50s every December and January and returning to the mid-to upper-60s in spring and summer. Occupancy averaged 66.8 percent in March ’24, up from 64.2 percent in February and 55.4 percent in January but down from 68.5 percent in March of last year. Occupancy fell as low as 37.7 percent in July ‘20, reflecting the impact of the COVID-19 pandemic. However, the overall trend has been upward since. Houston hotel occupancy averaged 60.2 percent over the 12 months ending March ’24, up from 58.6 percent during the comparable period in ’23.

RevPAR dropped as low as $14.37 in April ’20, the worst month of the pandemic for nearly all sectors of the region’s economy. Improving occupancy boosted March ’24 RevPAR to the second-highest level of the past five years. The return of large-scale conferences has played a pivotal role in boosting demand and complementing corporate travel. Events such as the College Football Playoff National Championship and the Houston Livestock Show and Rodeo have also contributed to increases in occupancy, RevPAR, and ADR.

Fewer than 2,500 hotel rooms in 21 properties were under construction in metro Houston as of March ’24, according to CoStar. The limited growth should lift occupancy, RevPAR, and ADR above current levels. 

Prepared by Greater Houston Partnership Research

Patrick Jankowski, CERP
Chief Economist
Senior Vice President, Research

Leta Wauson
Research Director


Key Economic Indicators Real Estate

Occupancy averaged 66.8 percent in March '24

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