The U.S. hotel industry profits grew in 2024, but increased labor costs and inflation limited growth, according to profit-and-loss data from CoStar's STR division.
2024 per-available-room metrics (percentage change from 2023):
- Gross operating profit per available room: $73.60 (+3.2 percent)
- Total revenue per available room: $209.67 (+7.2 percent)
- Earnings before interest, taxes, depreciation and amortization per available room: $51.88 (+2.5 percent)
- Total labor costs per available room: $72.44 (+11.2 percent)
“Growth in total operating expenses, especially labor, has had the biggest impact on profits,” Raquel Ortiz, senior manager of financial performance at STR, said in as statement. “GOPPAR continued to slow at the end of the year with growth below the rate inflation. On the positive side, demand growth has been key to driving total revenues, which have been the best defense against high expenses and allowed for hotels to increase profits, albeit minimal. An increase in groups have helped improve F&B revenues, but not enough to mitigate the labor cost growth that has impacted margins.”
Among CoStar's top 25 markets, Miami posted the greatest difference in GOPPAR (+$12) and TRevPAR (+$27). Oahu realized the largest drops in both metrics, likely due to lower demand caused by the labor strikes.