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Market Report

Seattle-Tacoma Hospitality Market Report

Midyear 2023

Amid Record Room Rates, Airport-Adjacent and North
Seattle Hotels Note Historically High Demand

Elevated labor costs pressure hotel operations. Rising demand and tight hiring conditions fueled the fastest pace of ADR growth among major hospitality markets over the year ended in June. Headcounts in the local leisure and hospitality sector in June remained 3 percent under the year-end 2019 mark, compared to 1 percent nationally. With room night booking volumes improving by 11.4 percent during the past year, the shortfall is indicative of hiring difficulties that are driving lodging costs up. Hoteliers are boosting daily rates to support both improving room demand and rising wages, with all six submarkets noting record ADRs in the year trailing June. In light of an anticipated near-term slowdown in the economy, however, these historic room rates could deter budget-conscious travelers and prolong the metro’s return to 2019 levels of occupancy. 
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