A new hospitality outlook from Marcus & Millichap indicates that the sector is entering a more complex phase in 2026, as growth moderates after a strong post-pandemic recovery. Occupancy levels have softened amid macroeconomic uncertainty, increased supply and slower job creation, while average daily rate (ADR) has continued to rise and revenue per average room (RevPAR) has largely flattened. A surge in new hotel deliveries — expected to peak at roughly 95,000 rooms in 2026 — is intensifying competitive pressures, particularly in high-growth development markets. At the same time, shifting cost dynamics and pricing recalibration are reshaping investment activity, with many assets trading below replacement cost and private investors driving the majority of transaction volume. Despite near-term headwinds, including geopolitical uncertainty and rising travel costs, constraints on new construction are expected to support existing assets. Over the longer term, the report suggests
