A midyear update from Kalibri, the hospitality industry’s first Profit Platform, indicates continued disruption in U.S. hotel performance as federal policy shifts reshape demand patterns. Drawing on data from over 35,000 hotels, the Summer 2025 edition of Navigating Market Turbulence analyzes trends through May 2025 and outlines implications for U.S. hotel profitability heading into peak summer travel season.

Key Findings:

Trends reflect performance from January 2024–May 2025, including actualized room nights through May 31 and 30-day future bookings as of May 30, 2025.

• U.S. Hotel Market Performance

Total U.S. actualized room nights fell 1% year-over-year through May, with 30-day future bookings pacing 2% below 2024 levels. Government and corporate demand declined 11% and 3%, respectively, dragging on overall commercial performance.

• Segment Shifts and Rate Pressure

Year-over-year growth in OTA (+2%), Loyalty Member Rate (LMR) (+7%), and Other discount transient segments (+2%) helped offset core segment losses but exerted downward pressure on ADR growth. Weekly data using a 4-week moving average show softening year-over-year growth in both room night demand and guest-paid ADR through late May.

• Regional Highlights: Washington, D.C. and Atlanta

In the Washington, DC/MD/VA market, YTD government room nights declined 26% year-over-year, with future bookings pacing 36% lower. Corporate demand also softened, but total room nights held flat as growth in discount transient segments helped offset declines. Atlanta posted modest YTD growth (+1%) across all segments, with similar gains in discount demand supporting volume. Both markets continue to face rate compression and evolving segment mix dynamics.

Cindy Estis Green, Co-Founder & CEO of Kalibri, commented, “The frequent and rapid changes in federal policy are causing economic uncertainty which typically leads to wait-and-see behavior both in corporate and leisure travel.  To navigate this evolving landscape, commercial teams need a granular, real-time view of demand. Precision—not broad targeting—will define the winners in today’s hospitality market.”

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What’s Next for the Industry

With government and corporate segments softening and discount transient segments expanding, hotel stakeholders must recalibrate strategies to drive revenue and maximize profit contribution. Kalibri provides a detailed roadmap by market, submarket, rate segment, chain class, and location type.

Download the full white paper:

www.kalibrilabs.com/summer-edition-market-turbulence

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