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Market Report

San Francisco Hospitality Market Report

2023 Investment Forecast

San Francisco Leads All Major U.S. Markets in Occupancy,
ADR and RevPAR Growth

Ongoing rebound permits nation-leading performance improvements. Major events, such as the NBA Finals and the return of notable conferences like Dreamforce, are providing significant momentum to the recovery of San Francisco’s hospitality sector. Last year, the metro led the nation in growth across all key performance indicators, with occupancy improving by more than 1,600 basis points. Meanwhile, ADR and RevPAR recorded gains of 38 percent and 86 percent, respectively. While this recent progress is promising, hotel fundamentals still remain well below levels observed prior to the pandemic, as the prevalence of hybrid and remote work schedules hinder business travel. However, several tailwinds may arise this year that will continue to drive room demand in the Bay Area. The J.P. Morgan Healthcare Conference returns in 2023, following a two-year hiatus. This is historically one of the highest revenue-generating events in San Francisco and provides a significant boost to annual hotel performance. Furthermore, China recently loosened travel restrictions, which could provide a boost to foreign arrivals, as the country traditionally accounts for the largest proportion of international visitors to the metro.
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