Hotel Demand Picks Up in October

October was a great month for the Houston hotel market, showing an 11-point gain in occupancy to reach 66.1%. ADR showed a gain of 8.9% to $124, while RevPAR had an impressive 20.8% year-over-year increase to $81.96.

Year to date, Houston continues to have a strong year, gaining 16.1% in overall revenue and increasing occupancy by 8.4% to 66.2%. ADR showed a 6.4% lift to $122, while RevPAR gained 15.4% to $80.60.

Market Trends

Hotel demand, or rooms sold, is strong this year. October demand increased significantly over September 2024 and continues to show gains in 2024 overall.

Houston is seeing growth across all hotel types, with gains in all room sizes and hotel classes for October. Occupancy rates for upscale class hotels peaked at 70.5%, a 14% lift compared to the same period last year, with upper upscale and upper midscale occupancy rates trailing just behind at a respective 69.6% and 67.3%. RevPAR gains were significant across all hotel classes, with double digit gains across all but the luxury class.

Travelers opted for mid-size hotels this October, with occupancy for hotels with 150-299 rooms reaching 67.7%, a 15.7% YOY gain. However, RevPAR and revenue gains were most significant for small boutique hotels, with RevPAR increasing 34.3% for hotels with under 75 rooms and revenue for the same hotel size increasing 33%.

October Submarket Comparison:

The CBD/Downtown submarket gained 11.9% in occupancy to hit 65.3% and 5.2% in ADR to reach $228. RevPAR increased 17.8% to $149, while demand and revenue gained 16.6% and 22.7%, respectively.
Houston East/Baytown gained an impressive 31.7% in revenue due to a 15.7% increase in demand. Occupancy gained 17.1% to hit 64.8%, while ADR and RevPAR showed respective gains of 13.8% and 33.3%.
The Uptown/Greenway Plaza submarket ended the month at 64.6% in occupancy, a 9.7-point gain, and $177 in rate, a 2.6% increase. RevPAR increased 12.5% to reach $114, while revenue gained 12.4%.
The Houston North/Woodlands submarket showed the highest occupancy rates of any Houston submarket, reaching 70.1%, a 14.1% gain. ADR increased 7.5% to $129, while RevPAR and revenue increased 22.7% and 24.3%, respectively.