Phoenix Hospitality Market Report
Development Picks Up Before Busy Event Slate;
Metro Revenues Ahead of 2019 Levels
Events and corporate demand enhance well-positioned market. Phoenix’s hospitality sector was more insulated from pandemic-related losses than many other major U.S. markets, both due to looser gathering restrictions and outstanding job growth. Business travel has returned here ahead of most American markets, allowing metro occupancy to reach within 210 basis points of the pre-pandemic mark as of May. Phoenix’s office-using employment count, which was roughly 15,000 roles ahead of 2019 job totals entering June, indicates further improvement in corporate-generated room demand moving forward. New construction of full service lodging may present short-term headwinds for the sector, specifically higher-tier hotels. Nevertheless, the metro will host Super Bowl LVII in 2023 and the 2024 March Madness Final Four, suggesting the increase in supply ahead of these events is warranted.