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Market Report

Texas Hospitality Investment Forecast

2022 Outlook

Gulf Coast Performance Heightened;
Large Cities Poised for Long-Term Success

Recovering jobs market, entertainment districts driving demand. Property fundamentals have improved substantially from the lows recorded in 2020, and by year-end, occupancy will trail the 2019 level by just 250 basis points. Coastal locales like Corpus Christi are benefiting from leisure travel gravitating more toward outdoor activities like golfing and visiting the beach. These areas entered the year with occupancy levels nearly on par with 2019 measures, mitigating downward pressure on nightly rates, allowing ADR to climb above pre-pandemic values last year. Revenues in Texas' prominent interior markets will benefit from expansions to entertainment districts like the new Alamo Museum at the San Antonio River Walk. Business-related travel remains the missing driver in these large cities, but the arrival of multiple new corporate headquarters in each of the four major metros suggests business travel will be elevated from past years when in-office work becomes more common.
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