U.S. Hotels Market Size And Share

U.S. Hotels Market Size & Trends

The U.S. hotels market size was estimated at USD 263.21 billion in 2024 and is projected to grow at a CAGR of 7.1% from 2025 to 2030. The U.S. hotels market is a dynamic and multifaceted sector, influenced by economic conditions, travel trends, and consumer preferences. In the early 2000s, the market saw steady growth driven by strong domestic and international travel. However, the 2008 financial crisis significantly impacted the hotel industry, leading to a decline in occupancy rates and revenues. In the years following, the sector rebounded, fueled by increased business and leisure travel.

According to data published by the U.S. Travel Association in collaboration with Tourism Economics, the U.S. recorded a total of 77.7 million international arrivals in 2024, reflecting a robust year-over-year increase of 17%. Notably, this figure not only underscores the resilience of the country’s inbound tourism sector but also exceeds pre-pandemic benchmarks, marking a significant milestone in the industry’s recovery. Canada and Mexico emerged as the leading source markets, contributing substantially to the surge in visitation volumes.

This sustained growth in international tourism is poised to drive considerable momentum across the U.S. hotel industry. Elevated inbound traveler volumes are expected to support higher occupancy rates, particularly in key gateway cities such as New York, Los Angeles, and Miami, while also fostering increased average daily rates (ADR) and revenue per available room (RevPAR). Furthermore, the rise in long-haul leisure and business travel presents strategic opportunities for upscale and luxury hotel segments, as well as extended stay and boutique properties, to capture diversified demand. Collectively, these trends are anticipated to reinforce investment confidence, stimulate development pipelines, and contribute meaningfully to the overall growth trajectory of the U.S. hospitality sector.

Consumer preferences and travel trends are some of the key drivers of the U.S. hotels market. Over the past decade, the evolving expectations of travelers have forced the industry to adapt and innovate. More travelers are seeking personalized experiences, emphasizing convenience, comfort, and value. Millennials and Gen Z, in particular, are driving demand for boutique, design-oriented, and experiential hotels, leading to the rise of lifestyle brands. This generation also places importance on technology, with amenities such as mobile check-ins, smart rooms, and contactless payment systems becoming standard. In addition, the increase in “bleisure” travel (a mix of business and leisure travel) has led to more hotels offering business-friendly amenities such as co-working spaces and faster internet. Post-pandemic, there’s also a growing preference for longer stays and local, immersive experiences. The rise of sustainable tourism has led many hotel chains to implement eco-friendly practices, catering to environmentally-conscious travelers. These shifting preferences shape everything from hotel design to the types of services offered, making it essential for hotel operators to stay attuned to the changing tastes of the market.

The growth of the U.S. hotel industry is underpinned by a multifaceted strategy that blends strategic partnerships, technological integration, and responsiveness to emerging market dynamics. These elements have enabled hotel operators to expand their service offerings, optimize operational efficiency, and respond to evolving consumer expectations, ultimately fostering resilience and long-term growth.

Strategic partnerships have emerged as a cornerstone of industry advancement, offering a structured pathway to innovation and service differentiation. In 2024, the American Hotel & Lodging Association (AHLA) reported a record 33 strategic alliances across technology, media, sustainability, and guest experience domains. Noteworthy among these collaborations is the partnership with DIRECTV HOSPITALITY, which delivers tailored in-room entertainment solutions adaptable to both large-scale and boutique properties. By aligning with a media solutions provider of this scale, hotel operators are empowered to enrich the guest journey and elevate brand standards. Similarly, Cvent, a leading meetings, events, and hospitality technology provider, plays a critical role in AHLA’s operational infrastructure by powering event registration, attendee engagement, and on-site logistics for AHLA-hosted conferences and trade events. These engagements are emblematic of a broader trend wherein hotels increasingly leverage ecosystem partnerships to unlock new revenue streams, reduce inefficiencies, and enhance customer touchpoints.

Parallel to strategic alliances, technological innovation has become a defining attribute of the sector’s growth agenda. AHLA’s partnership with the International Food and Beverage Technology Association (IFBTA) signals the industry’s commitment to deeper digital integration across ancillary services. The collaboration aims to enhance the interoperability between lodging operations and F&B systems, offering hotel operators access to next-generation tools in digital menu management, contactless payment systems, and AI-driven guest personalization. The initiative also promotes knowledge transfer and supply chain connectivity across lodging and food service verticals, thereby positioning hotels to respond swiftly to shifts in consumer expectations. More broadly, U.S. hotel chains are scaling investments in mobile-first technologies, keyless entry systems, AI chatbots, and cloud-based property management systems (PMS). These innovations not only enhance operational agility and cost control but also drive data-informed decision-making across functions ranging from revenue management to guest retention. The sector’s digital transformation is no longer ancillary; it is a core enabler of competitive differentiation in an increasingly experience-driven hospitality landscape.

In addition to internal transformation, the industry’s responsiveness to macroeconomic and infrastructural developments has unlocked new sources of demand. A compelling example lies in the correlation between the rise of data center construction and the performance of adjacent hotel markets. According to Wyndham Hotels & Resorts, properties located near major U.S. data center development hubs reported a notable increase-approximately 5% year-over-year-in revenue per available room (RevPAR) during 2024. This uplift is primarily attributed to the influx of construction workers, engineers, and infrastructure consultants requiring extended-stay accommodations. This phenomenon illustrates how the hotel sector is benefiting from non-traditional travel segments, including corporate project workforces and decentralized teams. The ability to capitalize on such demand hinges on localized revenue strategies, flexible room inventory management, and proximity-based marketing initiatives.

Consumer Insights & Surveys

The above data from the Knight Frank 2024 report shows a share of High-net-worth individuals (HNWIs) who say they are trying to reduce their carbon footprint. High-net-worth individuals (HNWIs) are increasingly prioritizing sustainability in luxury hotels, seeking accommodations that align with their values of environmental stewardship and cultural preservation.

In response, brands such as Six Senses, Four Seasons, and Soneva Fushi are integrating eco-friendly practices, such as renewable energy, waste management, and locally sourced dining, to meet these demands. Sustainable hotels offer guests unique experiences that not only provide indulgence but also contribute to environmental preservation with initiatives such as regenerative tourism and responsible construction. This blend of elegance and responsibility appeals to HNWIs who value sustainability.

A 2021 TripAdvisor survey revealed that Millennials are leading the recovery of U.S. traveler confidence in luxury travel. While nearly 60% of travelers across all age groups cited cost as a key factor when booking their next trip, only 40% of high-income Millennials expressed similar concerns.

Price Range Insights

The luxury and upscale segment accounted for a share of about 61% of the U.S. hotels market in 2024. This segment dominates the overall hotel industry in the region. Shifts in consumer preferences are reshaping the luxury hotel industry. Guests increasingly prioritize unique experiences over opulent formality, driving luxury hotels to offer cultural immersion, personalized services, and exclusivity. Higher disposable incomes, especially among high-net-worth individuals (HNWIs), have contributed to greater spending on luxury travel. As the U.S. economy has seen growth in certain sectors, more travelers are willing to splurge on premium experiences, making luxury hotels more appealing. In addition, many people are choosing to stay in upscale properties for longer periods, contributing to the rise in demand for upscale stays.

                         Source: The American Hotel and Lodging Association (AHLA)

Demand for midscale hotels is projected to rise at a CAGR of 7.6% from 2025 to 2030. As travelers become more budget-conscious, midscale hotels have emerged as an appealing option in the hotel industry. These properties typically offer a balance of affordability and quality, making them ideal for those seeking comfort and convenience without the premium price tag of luxury hotels. With a focus on providing essential amenities like clean, comfortable rooms, free breakfast, and Wi-Fi, midscale hotels cater to both leisure and business travelers looking for value for money.

Ownership Model Insights

Chain hotels accounted for a share of about 70% of the overall U.S. hotels market in 2024. Chain hotels dominate the hotel market due to their ability to adapt to regional nuances and create tailored strategies. Hilton, for instance, uses a hub-and-spoke model in emerging markets, establishing flagship brands and local infrastructure before expanding. This localization includes adapting to cultural needs, such as designing flexible wedding spaces in India for its Signia brand.

The independent hotel industry is expected to grow at a CAGR of 6.2% from 2025 to 2030. The market is poised for growth due to its ability to offer personalized services, unique design, and authentic local experiences that resonate with travelers seeking individuality. Independent hotels excel in creating bespoke stays with a strong sense of place and cultural integration, while boutique hotels captivate guests with immersive experiences and distinct aesthetics. In addition, the rise of soft branding by major chains such as Marriott and Hilton, through collections such as Autograph and Curio, supports independent hotels by blending their charm with global brand benefits, amplifying their appeal to a broader audience.

Booking Mode Insights

The direct booking segment accounted for a share of about 46% of the U.S. hotels market in 2024.Direct booking channels, particularly hotel-owned websites, and mobile apps have gained considerable traction over the past decade. U.S. hotel brands are increasingly prioritizing direct digital bookings due to the control they offer over pricing, customer data, loyalty programs, and brand messaging. Marriott International, for instance, has reported consistent growth in app-based bookings since the relaunch of its Bonvoy mobile platform, with mobile direct reservations accounting for a growing share of its leisure and business segments. This strategy reduces dependency on commission-heavy third-party channels and enables more personalized marketing and upselling opportunities. As part of this shift, major hotel chains have invested significantly in UX design, multilingual content, dynamic pricing engines, and real-time inventory synchronization to optimize the direct booking journey.

Online Travel Agencies (OTAs) such as Booking.com, Expedia, and Agoda continue to play a vital role, particularly in expanding market access and driving bookings from price-sensitive or international travelers. While these platforms charge commissions, their high visibility and global reach are essential for mid-sized and independent hotels aiming to maintain occupancy rates in competitive markets. According to a 2023 report by Phocuswright, OTAs represented approximately 49% of online hotel bookings in the U.S., underscoring their continued relevance. Some hotel operators are now exploring hybrid models-offering select inventory through OTAs while incentivizing repeat customers to shift toward direct bookings via discounts or value-added services.

The bookings through marketplaces are anticipated to register a CAGR of 8.8% from 2025 to 2030. The various marketplaces offer a one-stop solution where customers can compare hotels, locations, prices, and amenities quickly, all in one place. Travelers can easily filter options based on their needs (e.g., price range, star rating, guest reviews) without having to visit multiple hotel websites.Booking platforms often offer exclusive discounts, special deals, and bundled packages (e.g., flights and hotels together), making them a cost-effective choice. They also frequently run promotions that can give customers better rates than booking directly through hotels.

The rise of marketplace bookings represents a pivotal shift in the U.S. hotel industry’s distribution strategy, signaling an evolution toward greater decentralization and digital fluidity in how accommodations are discovered, compared, and transacted. Unlike traditional online travel agencies (OTAs) that control both the customer interface and booking mechanics, marketplace platforms serve as aggregated ecosystems-curating inventory from multiple hotel brands, independent properties, short-term rentals, and even non-traditional lodging formats, while empowering the end user with comprehensive choice, transparency, and often, user-generated content.

Marketplaces such as Airbnb, Vrbo, and Google Hotels are expanding beyond their original niches to include boutique hotels, apart-hotels, and branded residences. Airbnb, for instance, has actively pursued partnerships with hotel operators, particularly lifestyle and design-forward accommodations, to expand its professional hospitality offerings. By positioning itself as both a lodging discovery tool and a global distribution platform, Airbnb allows independent hotels to gain access to a younger, experience-driven traveler demographic that values authenticity, locality, and seamless mobile-first interactions. In 2023, Airbnb’s “Airbnb for Work” program also began onboarding boutique hotels catering to business travelers, further encroaching on traditional corporate travel segments historically dominated by OTAs and GDS channels.

Similarly, Google’s entry into the hotel marketplace has significantly altered how consumers engage with hotel searches and bookings. Through Google Hotels, travelers can view real-time prices, availability, location filters, reviews, and loyalty program rates all in a single interface. What distinguishes this model is that Google acts as a meta-marketplace-redirecting traffic either to OTAs or to the hotel’s website, depending on the bidding structure and advertising strategy. This has pressured hotels to improve rate parity, enhance their digital presence, and compete more actively for visibility in search results. As a result, hotels are allocating increased budgets to Google Hotel Ads, recognizing the marketplace’s dual role as both a discovery engine and a conversion gateway.

Key U.S. Hotels Company Insights

The competitive landscape of the U.S. hotel industry is characterized by a sophisticated interplay of global hotel chains, regional operators, independent properties, and technology-driven entrants, all vying for market share in an increasingly fragmented and demand-sensitive environment. This landscape has become notably more complex over the past decade, driven by evolving traveler preferences, technological innovation, and structural shifts in distribution, branding, and asset ownership models.

The dominance of major hotel groups such as Marriott International, Hilton Worldwide, Hyatt Hotels Corporation, and IHG Hotels & Resorts continues to define the upper tier of the competitive spectrum. These companies maintain expansive brand portfolios catering to multiple price points and traveler profiles-ranging from luxury (e.g., Waldorf Astoria, Ritz-Carlton) to midscale (e.g., Hampton by Hilton, Holiday Inn Express) and extended stay formats (e.g., Residence Inn, Staybridge Suites). Their competitive advantage lies in deep loyalty ecosystems, operational scale, centralized revenue management systems, and negotiated corporate travel contracts. Marriott, for instance, leverages its Bonvoy loyalty program, which has over 180 million members globally, to drive repeat business and brand stickiness across its diversified brand architecture.

Recent Developments

• In December 2024, Hyatt Hotels & Resorts announced its plan to open 50 luxury hotels by 2026, building on a successful 2024. In the past year, the company opened 28 upscale properties, including the Park Hyatt London River Thames and Thompson Palm Springs. Hyatt also acquired Standard International and the curated travel site Mr and Mrs Smith. The new hotels will be divided into two categories: the “Luxury Portfolio” for high-end properties and the “Lifestyle Portfolio” for culture-driven, trendy accommodations. The expansion is part of Hyatt’s strategy to capitalize on growing demand in the luxury and lifestyle segments.

• In December 2024, Lifestyle Hospitality Capital (LHC) Group acquired The Gates Hotel South Beach in Miami, Florida, in an off-market deal. The 235-room hotel will undergo a major renovation and will be rebranded as The Dean Hotel – Miami Beach. This marks the Dean brand’s U.S. debut, with plans for further expansion. Following recent growth into Munich and Berlin, the rebranding positions The Dean as a prominent player in the U.S. market, expanding its global footprint.

• In February 2024, Six Senses Hotels Resorts Spas, a subsidiary of IHG Hotels & Resorts, announced its intention to launch its inaugural U.S. resort in South Carolina, with an opening date set for 2026. Following this announcement, the brand revealed additional U.S. locations, including resorts in Napa, California, and Telluride, Colorado, both slated for 2026 and 2028, respectively. The forthcoming Six Senses South Carolina Islands will embody eco-conscious design. It will feature a resort, spa, and residential community along a picturesque stretch of South Carolina’s coastline, encompassing Hilton Head Island, Daufuskie Island, and Bay Point Island. Situated conveniently near Savannah/Hilton Head International Airport, the resort is positioned to attract visitors seeking luxury and sustainability.

• In August 2023, Wyndham Hotels & Resorts and LuxUrban Hotels Inc., a prominent hotel operator with nearly 20 properties in major U.S. urban markets, revealed a new agreement to integrate 16 LuxUrban hotels, totaling around 1,400 rooms, into Wyndham’s Trademark Collection brand.

U.S. Hotels Market Report Scope

U.S. Hotels Market Report Segmentation

This report forecasts revenue growth at the country level and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2018 to 2030. For the purpose of this study, Grand View Research has segmented the U.S. hotels market report by price range, ownership model, and booking mode:

• Price Range Outlook (Revenue, USD Billion, 2018 – 2030)

  • Economy

  • Midscale

  • Luxury and Upscale

• Ownership Model Outlook (Revenue, USD Billion, 2018 – 2030)

  • Independent Hotels

  • Chain Hotels

• Booking Mode Outlook (Revenue, USD Billion, 2018 – 2030)