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Market Report

Dallas-Fort Worth Hospitality Market Report

Midyear 2023

Hotels Aided by New City Council Ordinances;
Universal Theme Park Follows PGA to the Metroplex

New short-term rental regulations curb lodging alternatives. In 2023, Dallas-Fort Worth will mark an eighth consecutive year of more than 2,400 rooms coming online. This rapid inventory expansion is hindering the market’s occupancy recovery, keeping the metric below the record high yearlong average rate of 70.3 percent achieved in 2016. Still, by the end of this year, demand will be 6 percent higher than the pre-pandemic peak, illustrating the need for new hotels. Yet, both the Dallas and Fort Worth City Councils have passed new regulations and enforcements for short-term rentals (STR) in residential areas. These ordinances took effect immediately and are expected to be enforced by the end of 2023. Based on inventory estimates, the Dallas City Council expects that up to 95 percent of the city’s STR stock will be illegal. Additional owner fees are now required as well, likely increasing the cost of operating and renting STRs and directing more travelers to traditional hotels.  
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