Occupancy in Houston hotels fell 3.9% in April, landing at 62.5%, due to a 4.4% decline in overall demand, or rooms sold compared to the same month a year ago. Rates continue to rise however, showing a 5-point lift in ADR to $125, which supported a 1% increase in RevPAR at $78.
Year to date, occupancy is down 1.2% at 61.4%, but ADR is up, reaching $126, a 5% gain. RevPAR increased 3.7% to $77, while revenue gained 3.2% year-over-year.
April Submarket Comparison:
- The CBD/Downtown submarket gained 4.7% in occupancy over last April, reaching 67.6%. ADR showed a 3.7% lift to $229, while RevPAR hit $155, an 8.5% lift. An 8% gain in overall demand also supported a 12% YOY increase in revenue.
- The Uptown/Greenway Plaza submarket showed gains in April, lifting 1.3% in occupancy to 65.8% and 3.1% in rate to $184. RevPAR increased 4.4% to $121; however, revenue still lags, showing a 2.7% YOY decline.
- In the Medical Center/NRG, occupancy lost 1.7% over last year, to 63.8%. ADR showed a 3.5% lift to $150, while RevPAR reached $96, up 1.7%.
- Occupancy in the Southwest Freeway submarket is down 7% to 62.4%, though ADR gained 2.2% YOY to $84. Overall demand is down 5.8%, resulting in a 3.7% decline in revenue.
- Though occupancy in the Houston Hobby Airport/NASA submarket dipped 6.4% to 60.6%, rates continue to rise, lifting 11.8% YOY to $95. Growth in rates and a 1.3% lift in demand helped to drive RevPAR up 4.7% to $58 and revenue up 13.3%.
Behind the Numbers
The CBD and Uptown/Greenway Plaza submarkets showed an increase in transient, or leisure, travelers in April. The Downtown submarket gained about 2.4% in transient bookings, while Uptown increased transient travel by 4.4%. Group travel, or rooms booked in reserved blocks, showed the highest lift in the George Bush Airport submarket, up 27.6% over last April, while the Medical Center/NRG submarket rose 23.8% YOY.
Almost all hotel class segments showed declines in occupancy in April, apart from Upper Upscale class, which grew by 2% in occupancy to reach almost 69%. Consistent with overall hotel KPIs, rates continue to gain, with growth across all segments except Economy class, which dipped marginally at 0.2%.
What’s Driving the Market
Some declines in the overall market can be credited to the shift in the Easter holiday, which fell in April this year, vs. March in 2024. Historically, Easter causes downturns in hotel performance. However, some major events helped to support gains in some markets, including First Robotics, an international youth STEM convention, which creates strong compression throughout the inner loop markets.
Additionally, the George R. Brown Convention Center hosted the Specialty Coffee Association expo at the end of April, which drew approximately 17,000 attendees. Other major events in April included the Rockets playoffs, as well as the Kendrick Lamar and SZA concert, which estimated over 47,000 attendees and drove occupancy to 80% in the Medical Center/NRG submarket on the day of the concert.
Written by Megan Henson
Pictured: Hilton Galveston Island Resort
