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Market Report

Tampa-St. Petersburg Hospitality
Market Report

2023 Investment Forecast

Competition Ripples Through Metro Amid Wave of New Supply;
Buyers Target Hotels Outside of Tampa Proper

Cost considerations shore up hotel demand. Recent economic uncertainty has put more budget-friendly locations on leisure travelers’ radars, and Tampa-St. Petersburg is no exception. Many tourists seeking South Florida-esque beaches are instead opting to visit the metro, thanks to an ADR that has remained roughly $80 lower than both Miami-Dade and West Palm Beach entering this year. As such, Tampa-St. Petersburg recorded the strongest improvement in occupied room nights among major Florida markets from 2019 to 2022. Nearly-recovered pre-pandemic inbound passenger volumes at Tampa International Airport — along with over 250 cruise ship calls scheduled for 2023 — suggest this momentum should continue, with recuperating cruise activity supporting an annual occupancy rate in Tampa East that is well-above other submarkets. Nevertheless, competition has been stiffened metrowide by an ongoing wave of new supply, stunting a return to pre-pandemic levels of occupancy. The rate is projected to fall 210 basis points below the 2019 recording amid the completion of roughly 1,300 new rooms this year, a volume that represents over 2 percent of current inventory. Although this may cause a retreat in other performance indicators, the metro remains in a good spot historically speaking, registering ADR and RevPAR metrics that sit more than 18 percent higher than their respective pre-pandemic figures. 
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