CANADA | The Canadain hotel industry has continued to flourish in the post-pandemic market, with daily rates and customer satisfaction increasing.
Canadian hotel industry achieved continued performance gains through average daily rate (ADR), according to CoStar’s June 2024 data.
CoStar is a leading provider of online real estate marketplaces, information and analytics in the property markets.
“ADR continues to be the main driver of RevPAR improvement in Canada,” said Laura Baxter, CoStar Group’s director of hospitality analytics for Canada.
The 3.7 percent increase in room rates exceeded the 2.7 percent inflation reading in June, helping hoteliers absorb rising costs. Occupancy increased marginally again, with Tuesday and Wednesday nights producing the highest actual levels (80 percent), suggesting strong business travel.
Across classes, only luxury and upper upscale hotels saw occupancy growth, while select-service hotels reported a decline once again. With more mortgages being renewed at much higher interest rates, Canadian customers have felt the pinch.
“The split in the data suggests that consumers with enough disposable income to stay in luxury and upper-upscale hotels continue to do so. Meanwhile, cost-conscious guests who stay in select- and limited-service hotels have tightened their belts to a greater degree.”
Among the provinces and territories, Newfoundland and Labrador recorded the highest occupancy level (82.8 percent), which was 4.6 percent below 2023
Among the major markets, Toronto saw the highest occupancy (84.7 percent), up 1.5 percent over June 2023. Despite this increase, ADR declined for the second consecutive month, primarily due to a 5.6 percent decrease in transient rates.
Saskatchewan had the lowest occupancy among provinces (63.3 percent), up 0.4 percent from 2023. At the market level, Edmonton had the lowest occupancy (+7.5 percent to 62.2 percent).
There are several major hotel chains that have selected Canada as the ideal market for expansion. These include new builds and the transformation of existing properties. Individual hotel owners have also gained traction within the market.
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