How U.S. Hotels Are Pivoting as International Travel Slows
The U.S. hotel industry has faced a challenging stretch since early 2025, driven largely by a sustained decline in international visitation. New data from STR shows hotel occupancy fell for the ninth consecutive month in November 2025, down 2.8 percent year over year to 57.9 percent. Revenue per available room declined 2.3 percent to $88.97, while average daily rate edged up just 0.6 percent, the only major metric to post growth.
The downturn coincides with a growing list of travel advisories issued by countries including Canada and several European nations. Germany recently updated its guidance for citizens traveling to the United States, citing security concerns. At the same time, new visitor-related costs such as the $250 visa integrity fee introduced in 2025 and higher national park surcharges for non-U.S. residents have added friction for inbound travelers. Proposals calling for increased scrutiny of foreign visitors, including expanded reviews of social media history, have further weighed on demand.
According to Rod Clough, president of the Americas for HVS, much of the international demand lost early last year is unlikely to return in the near term. While events such as the World Cup could offset some of the shortfall later in the year, Clough says hotels are adjusting to a prolonged reset in travel patterns.
In response, many properties are pivoting sharply toward domestic travelers. Tim Hentschel, co-founder and co-CEO of HotelPlanner, notes that international visitation declined roughly 6 percent in 2025. Rather than signaling reduced interest in travel overall, he says it reflects a shift toward shorter, closer-to-home trips.
Hotels are responding by localizing offers, adjusting minimum stay requirements, and emphasizing value-added perks rather than rate cuts. At Virgin Hotels New York City, General Manager Denise Luna says inventory has been realigned to match domestic booking behavior, with greater flexibility for short stays and long weekends. Programming tied to wellness, dining, and cultural events helps ensure even brief visits feel purposeful.
Industry observers say this transition marks a new phase for U.S. leisure travel. Paul Whitten, founder of Nashville Adventures, believes domestic weekend trips, group celebrations, and regional getaways are rapidly becoming core revenue drivers, particularly in markets less dependent on overseas visitors.
Despite the headwinds, there are bright spots. Leisure group bookings, including weddings and corporate events, are up year over year and often secured well in advance, helping stabilize rates. Looking ahead, experts expect international demand to rebound gradually if currency conditions improve, while major events such as the World Cup and America’s 250th anniversary generate renewed interest. For now, hotels that successfully embrace domestic demand appear best positioned to weather the shift and emerge stronger.
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