Demand for US boutique hotels increases

US: Increases in demand and revenues for boutique hotels in the United States reveals that deviation from the “generic sameness” of traditional accommodation is appealing to travellers, says The Highland Group.

The Boutique Hotels: Mid-Year 2023 report supplements the Boutique Hotel Report 2023. Released earlier this year, the latter revealed that rate increases had pushed most boutique hotels to full RevPar recovery.

Since then through June 2023, revenues have continued to rise by nine per cent supported by an increase in demand by eight per cent (compared to the previous period in 2022).

The lifestyle boutique hotel segment averaged the largest increases in performance, while soft brands reported a five percentage point premium in RevPar recovery compared to the same class of US hotels.  

Rate growth for luxury boutique hotels has stabilised during this period. 

Looking forwards, development of boutique hotels shows a 29 per cent annual increase in the pipeline of new rooms, projected through 2027.

Kim Bardoul, partner at The Highland Group, said: “Each segment of boutique hotel product has a positive story to tell whether in occupancy, ADR, or revenue increase compared to the previous year. Interest in development of the boutique hotel product is justified by continued solid performance.”

Additional insights from The Boutique Hotels: Mid-Year 2023 report can be found here.

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