Commercial real estate brokerage firm Marcus & Millichap has released outlooks and forecasts for hospitality investment in 10 major U.S. markets.
Atlanta
“Atlanta is still a fundamentally corporate-driven market, and that’s what’s allowing operators to push rates even as occupancy softens under new supply,” John M. Leonard, senior managing director, market leader, Atlanta, said in Marcus & Millichap’s 2026 Atlanta Hospitality Outlook Report.
Key findings include:
- Approximately 1,000 rooms are expected to be delivered in 2026, a sharp reduction from last year as fewer new projects come online.
- Occupancy is projected to decline to 62.2 percent, marking a third consecutive year of modest softening.
- Average daily rate is forecast to rise to $127.87, supported by steady growth in room bookings.
- Revenue per available room is expected to increase slightly to $79.49, keeping Atlanta near the middle of major U.S. markets for growth.
- Investment activity is concentrating in select-service and suburban assets, particularly in areas with strong business travel demand and connectivity.
“Buyers are being disciplined, but capital is still targeting well-located assets tied to corporate demand and infrastructure,” Leonard added.
Austin
“The combination of strong corporate expansion, major event demand, and continued population inflows reinforces Austin’s long-term investment appeal, particularly as market fundamentals stabilize beyond the current supply wave,” Allan Miller, senior managing director investments, said in the Austin Hospitality Investment Forecast Report.
Key findings include:
- Tourism and event-driven demand remain strong, supported by major events like Formula One and South by Southwest, along with continued in-migration and corporate expansion fueling long-term lodging needs.
- Approximately 1,600 new hotel rooms are expected to be delivered in 2026, representing a notable increase in supply, with most development concentrated in downtown Austin.
- Occupancy is projected to decline modestly due to elevated supply levels, though Austin is expected to outperform many other major Texas markets.
- Average daily rates are forecast to soften slightly to $163.34, reflecting increased competition and ongoing normalization following post-pandemic peaks.
- RevPAR is anticipated to decline to $101.33, driven by a combination of lower occupancy and average daily rate, though long-term fundamentals remain supported by strong economic and population growth.
Chicago
Key findings from the Chicago Hospitality Investment Forecast Report for 2026 include:
- Transient demand is fueling booking growth as renovation-driven property improvements offset softer group demand, supporting RevPAR and ADR gains above pre-pandemic levels.
- New hotel supply remains limited in the near term due to ongoing renovations, though a larger delivery pipeline is expected in 2026 as the market prepares for major global events.
- Downtown Chicago faces softer performance tied to reduced business travel, while suburban submarkets and leisure-driven areas continue to show stronger occupancy trends.
- Value-add investment opportunities are expanding, with pricing adjustments and renovation upside attracting investors to both urban and suburban assets.
- 2026 forecasts indicate continued ADR and RevPAR growth, with occupancy stabilizing and supply expansion remaining measured despite increased development activity.
“Suburban Chicago hospitality assets are benefiting from steady leisure demand and limited new supply, supporting occupancy gains and making these submarkets increasingly attractive for investors seeking stable returns and long-term upside," Steven Weinstock, senior managing director and market leader - Chicago, said in the report.
“Downtown Chicago’s hospitality sector is navigating a period of recalibration, as reduced business travel weighs on performance; however, ongoing renovations and strong transient demand are helping stabilize fundamentals and position assets for long-term growth,” said Joe Powers, managing director and market leader - Chicago.
Cleveland
“Cleveland’s hospitality sector is demonstrating renewed momentum, supported by rising tourism, infrastructure investment and sustained demand growth that continues to elevate the market’s long-term investment appeal,” Grant Fitzgerald, managing director and market leader, said in the Cleveland Hospitality Investment Forecast Report for 2026.
Among the key findings:
- Tourism expansion and infrastructure improvements are strengthening Cleveland’s appeal, with the metro ranking among the top major U.S. markets for room-night demand and occupancy recovery in 2025.
- Major events and new developments, including large-scale concerts and the Cleveland Browns’ stadium project, are expected to further boost visitation and support hotel demand.
- Demand growth is being driven by both leisure and corporate travel, with Cleveland maintaining occupancy rates above the long-term average despite recent moderation.
- New supply remains limited, with approximately 330 rooms expected to be delivered in 2026, helping sustain relatively tight market conditions.
- Performance metrics are stabilizing, with occupancy projected near 60 percent, ADR reaching roughly $133, and long-term investment supported by strong institutional drivers such as the Cleveland Clinic.
Houston
“Houston’s hotel sector is demonstrating renewed momentum, supported by strong event-driven demand and improving operating fundamentals that are attracting increased investor interest,” Ford Noe, senior managing director and Houston market leader, said in the Houston Hospitality Investment Forecast Report.
Key findings include:
- Event-driven demand, including the 2026 FIFA World Cup, is expected to boost international visitation and support hotel performance, building on Houston’s strong convention and sports tourism appeal.
- Occupancy is projected to rise by 10 basis points to 59 percent in 2026, marking continued recovery while remaining below the pre-pandemic peak of 65 percent.
- After a modest decline in 2024, average daily rate is forecast to grow to $123.82, reflecting improving pricing power across the metro.
- RevPAR is expected to increase by 3.0 percent in 2026, reaching approximately $72.99, about 15 percent above 2019 levels.
- Supply growth will remain limited, with new inventory concentrated in CBD and southern submarkets, while development activity stays constrained by elevated construction costs and financing challenges.
“Improving occupancy and ADR trends, combined with Houston’s expanding global profile, are positioning the market for sustained RevPAR growth and long-term investment potential,” Noe added.
Miami-Dade County, Fla.
“Miami-Dade is one of the few major markets where new supply isn’t disrupting fundamentals. Demand across international, leisure and corporate segments is deep enough to keep both occupancy and pricing on firm footing,” Victor Garcia, managing director and market leader, Miami, said in the Miami-Dade Hospitality Investment Outlook Report.
Key findings include:
- Approximately 1,200 rooms are expected to be delivered in 2026, with about half located in Miami Beach.
- Occupancy is projected to remain stable at 73.9 percent, reflecting balanced supply and demand conditions.
- Average daily rate is forecast to rise to $230.37, ranking among the fastest-growing major U.S. markets.
- RevPAR is expected to increase to $170.20, supported by strong performance across all service segments.
- Investment activity is expanding into high-growth submarkets beyond Miami Beach, including Coral Gables and Miami Gardens.
“Few major markets nationally can absorb this level of new supply while still driving both rate and revenue growth, and Miami is one of them,” added Victor.
Minneapolis-St. Paul
“Minneapolis-St. Paul’s hospitality sector is entering a new phase of stability, supported by resilient corporate travel demand and a steady recovery in leisure activity,” Todd Lindblom, senior managing director and market leader, said in the Minneapolis-St. Paul Hospitality Investment Forecast Report.
Key findings include:
- Modest tailwinds are expected to support demand growth in 2026, driven by strong corporate travel tied to major employers and improving international travel through Minneapolis-St. Paul International Airport.
- Occupancy levels are projected to rise to approximately 60.2 percent, marking continued expansion and narrowing the gap with the long-term average.
- Limited new supply, with only about 250 rooms expected to deliver in 2026, will help maintain balanced market conditions and support occupancy gains.
- Average daily rates are forecast to increase to roughly $135.12, reflecting steady pricing power as demand improves.
- RevPAR is anticipated to recover to approximately $81.40, surpassing pre-pandemic levels for the first time and signaling strengthening hotel performance fundamentals.
“Investors are likely to find compelling opportunities in Minneapolis-St. Paul as improving fundamentals, constrained supply, and diverse demand drivers position the market for sustained growth,” Lindblom added.
Nashville
“New supply has been the defining story in Nashville, and it’s now starting to show up in occupancy. The market is still generating solid room demand, but the pace of deliveries is keeping overall performance in check,” Jody McKibben, senior managing director and market leader for the Mid-South, said in the 2026 Nashville Hospitality Investment Outlook Report.
Key findings include:
- Nashville remains among the top U.S. markets for supply growth, marking its fifth consecutive year at elevated levels.
- Occupancy is projected to decline to 64.4 percent as new inventory outpaces demand gains.
- Average daily rate is expected to increase slightly to $175.53, maintaining the highest level among inland, non-resort markets.
- RevPAR is forecast to decrease to $112.97, though it remains above pre-pandemic levels.
- Supply growth is shifting outward, with suburban corridors seeing the greatest pressure while the urban core stabilizes.
“Investors are underwriting more conservatively, but assets in the urban core are holding up better as supply pressure begins to ease,” McKibben added.
Orlando
“Orlando is standing out because it’s one of the few major markets where occupancy is moving higher. That gain is being driven by higher-spending travelers, which is lifting overall performance even as lower-tier demand remains uneven,” said Paul Tesdal, managing director and market leader, Orlando/Jacksonville, said in the Orlando Hospitality Investment Outlook Report.
Key findings include:
- More than 1,900 rooms are expected to be delivered in 2026, a slowdown from last year’s pace of construction.
- Occupancy is projected to rise to 72.0 percent, ranking among the fastest increases across major U.S. markets.
- Average daily rate is forecast to increase to $205.40, marking a third consecutive year of growth.
- RevPAR is expected to reach $147.83, supported by gains in both occupancy and room rates.
- Full-service hotels continue to outperform, while limited- and select-service segments remain tied to lower-income consumer spending trends.
“Full-service properties are leading performance, while lower-tier hotels remain tied to more price-sensitive consumers,” Tesdal added.
Tampa, Fla.
“Tampa–St. Petersburg has been one of the strongest-performing Florida markets, but like others in the Sun Belt, it’s now working through a period where new supply is catching up with demand,” David Bradley, senior managing director and market leader, Central and North Florida, Tampa-St. Petersburg Hospitality Investment Outlook Report.
Key findings include:
- Just over 600 rooms are expected to be delivered in 2026, the lowest annual total in the past decade.
- Occupancy is projected to decline to 68.4 percent, remaining closer to pre-pandemic levels than the national average.
- Average daily rate is forecast to fall to $175.17, marking the first annual decline since 2020.
- RevPAR is expected to decrease to $119.77, though still roughly 28 percent above 2019 levels.
- Tampa-St. Petersburg remains comparatively well positioned, with occupancy among the closest to 2019 levels across major U.S. markets.
“The market isn’t losing demand; it’s adjusting to a higher level of inventory, and that’s changing how investors evaluate performance in the near term,” Bradley added.
The full reports can be downloaded from Marcus & Millichap’s market research library.