Hotels & Motels

The 45,358 hotel and motel companies in the US provide lodging for business and leisure travelers. The industry includes chains, franchises, and independent hotels. Franchise hotels are branded properties with independent owners. The franchise brand (Marriott, Hampton Inn, etc.) is known as the "flag." Large chains may offer franchises in addition to operating corporate-owned properties. About 70% of hotels are affiliated with a chain.

Large Capital Commitments

Building a new hotel requires significant investment in land, buildings, furnishings, and marketing expenses.

Integrating Technology

Hotels are rapidly integrating technology to improve their operational efficiency, mitigate labor shortages, and enhance the guest experience.

Aug 13, 2026 - Rising Temperatures Shift Hotel Travel Patterns

• Extreme heat is becoming a bigger factor in where and when Americans travel, creating new challenges for hotels. Around 4 in 10 adults say extreme heat has affected their travel or vacation plans, up from about one-quarter in 2024, according to an AP-NORC poll. Travelers may avoid especially hot destinations during the summer or shift trips to spring and fall, potentially changing traditional peak seasons for some hotels while benefiting properties in cooler markets. Heat can also raise operating costs. In a 2026 American Hotel & Lodging Association survey, 50% of hotel operators identified utility and energy costs as a financial pressure. Keeping rooms and common areas cool during prolonged heat waves can increase energy and water use and put more strain on hotel systems. Hotels may need to invest in more efficient cooling while adjusting pricing and marketing to changing travel patterns.
• The AI infrastructure boom is beginning to ripple into the hotel industry, with Hilton executives telling investors that construction of data centers is helping drive demand for its midscale and upper-midscale brands. Contractors, engineers, and other project workers book extended stays near major development sites. The company said the trend contributed to a 5% increase in US revenue per available room (RevPAR) during the second quarter and was one factor behind its decision to raise its full-year outlook. The broader lodging market also continues to strengthen. CoStar and Tourism Economics recently raised their 2026 hotel forecast after US room demand increased by more than 8 million room nights through the first of the year. The firms now expect US RevPAR to grow about 2.8% this year, suggesting that large-scale infrastructure projects, including data centers, are becoming an incremental source of lodging demand.
• The 2026 FIFA World Cup gave the US hotel industry a meaningful but uneven lift, with higher room rates driving revenue more than increased occupancy. According to CoStar, revenue per available room (RevPAR) in US host cities rose more than 20% above pre-tournament forecasts, while nationally, average daily room rates increased 9.2% and RevPAR climbed 9.6% during the week ending June 27. Illustrating the pricing power created by match-day demand, Miami saw average daily rates jump 51.1% and RevPAR increase 51.6% during one tournament week. However, occupancy gains were modest in many markets, and some host cities reported demand below early expectations. Overall, the World Cup proved to be a profitable event for many hotels, though the biggest financial benefit came from charging higher rates rather than filling significantly more rooms, according to CoStar and the American Hotel & Lodging Association.
• AI could upend one of the hotel industry's biggest competitive advantages by changing how travelers find and book rooms. Hotel executives speaking at the Hospitality Financial and Technology Professionals' HITEC conference said AI-powered travel assistants will steer guests to the properties that best match their preferences, making brand size and distribution networks less important than they are today. That shift could level the playing field for independent hotels while forcing major chains to compete more on personalized service, memorable guest experiences, and operational efficiency. Rather than replacing loyalty programs, AI is expected to enhance them by delivering more tailored recommendations and smoother booking and check-in experiences. The result is an industry where winning customers depends less on controlling the booking channel and more on delivering an experience guests want to repeat.

Industry size & Structure

A typical hotel employs fewer than 30 workers and generates about $5 million in annual revenue.

• The hotel industry consists of about 45,340 companies that employ 1.3 million workers and generate $221 billion annually.
• The industry includes chains, franchises, and independent hotels. Franchise hotels are branded properties ("flags") with independent owners. Large chains may offer franchises in addition to operating corporate-owned properties. About 72% of hotels are affiliated with a chain.
• Hotel categories are defined by price and the level of services and amenities offered. General classifications include luxury, upscale, midscale, and economy.
• Specialized hotels include resorts (which cater to vacationers) and extended stay properties (which include kitchens and additional space). Some corporate chains offer timeshare units, which give guests the option to stay at a particular property during a scheduled period.
• Large companies include Marriott International (Marriott, Renaissance, Courtyard, Fairfield Inn, Ritz-Carlton), Hilton Worldwide (Hilton, Doubletree, Embassy Suites, Hampton Inn, Homewood Suites), InterContinental Hotels (Holiday Inn, Crowne Plaza, Staybridge Suites, Candlewood Suites), and Best Western.
• Varying strength among flag hotels leads to varying levels of risk for new properties.