Toronto Hospitality Market Report

Normalization expected in 2025. Toronto’s hotel industry is poised to see a modest recalibration in operating fundamentals over the course of this year. Though demand is expected to hold on a growth trajectory, economic uncertainties – such as volatile borrowing costs and trade headwinds – present some downside risk. Combined with the introduction of new hotel supply, occupancy could slide as the market absorbs this additional capacity. Despite these challenges, Toronto’s hotel sector is poised to benefit from some unique demand drivers in 2025. For instance, Air Canada’s resumption of daily flights to China and new seasonal services to Korea could fuel a resurgence in international tourism. Meanwhile, Toronto’s global reputation and diverse economy will continue to serve as a backbone for business travel amid international conferences and corporate events. While economic risks may moderate growth in this segment over the short term, corporate travellers will continue to be a structural force influencing the metro’s hotel performance over the years ahead.