Hotel occupancy dipped in October compared to last year, dropping almost 8% to 61% while ADR showed a marginal decline, ending the month at $123, down 1%. RevPAR showed a 9-point dip to $74, while revenue dropped 9%.
Year to date, occupancy in the Houston market sits at 60%, down 9% compared with the same period last year. ADR is essentially flat at $122, while RevPAR is showing a 10% decline, down to $73. Demand and revenue have both dropped almost 10% compared to the same time period in 2024.
October Submarket Comparison:
- The CBD/Downtown submarket showed occupancy down about 2% to 64%, however the decline was largely due to a 2.4% increase in supply, as demand showed a slight uptick. Strong ADR growth helped to drive a 5.5% revenue boost in October, with ADR reaching $240, up 5% and RevPAR reaching $153, up 3%.
- In contrast, supply in the Uptown/Greenway Plaza submarket dropped almost 7%, causing occupancy to rise4.7% to 67.5%, while demand dipped 2.4%. ADR stayed flat at $179, while RevPAR showed a 4.8% gain, reaching $121.
- In the Medical Center/NRG submarket, occupancy is down 4% to $63. ADR is staying strong, growing by almost 4% to $146, while RevPAR stayed essentially flat at $92. Demand dropped 6% YOY, while revenue showed a 2.5% loss.
- In the Houston East/Baytown submarket, occupancy dipped 13% to 56.5%, with rate dropping about 6% to $84. RevPAR showed an 18% decline, while demand and revenue decreased 12% and 17% compared to the same time last year.
- Houston Hobby Airport/NASA ended the month at 58% occupancy and $89 in ADR, down 11%. RevPAR showed a 17.5% drop to $52, while revenue declined 17% YOY.
Behind the Numbers
Though the Houston market overall is still showing declines compared with last year’s record performance, revenue figures in October indicate that the market is normalizing and trending more closely to 2023, which did not hold major weather events.
Luxury-class-scale hotels continue to drive the market, showing a 3% gain in revenue over last October, due in part to an almost 4% gain in ADR. RevPAR also showed growth, gaining 3 points to $206.
What’s Driving the Market
The George R. Brown Convention Center held several large-scale conferences in October, helping support growth in markets like the CBD, Uptown and the Medical Center. The first week of October, the GRB welcomed the Quilts festival, which supported strong transient demand throughout the week of the event. Demand from Quilts compressed into Uptown as well, supporting occupancy gains. AfroTech also returned to Houston in October, supporting lift throughout the Houston market, with strong occupancy and ADR.
Written by Megan Henson
Pictured above: Westin Downtown Houston
