State and Regional Lodging Forecast (February 2026)

Forecast through 2029 of key lodging indicators — including supply, demand, occupancy, average daily rate, revenue per available room, and revenue — for California and its 12 tourism regions.

• Despite international travel declines, economic uncertainty, wildfires, and unrest in Los Angeles last summer, California’s hotel industry outperformed the overall US hotel industry in 2025.
• According to Tourism Economics’ February Lodging Forecast, California room revenue is projected to increase 3.5% in 2026, reaching $27.8 billion. Statewide ADR is expected to rise 2.2% to $195, surpassing the previous peak set in 2023.
• Supply in the Gateway markets is growing more slowly than in the remaining markets, which puts less pressure on occupancy rates. As a result, Gateway occupancy is forecast to rise slightly in 2026 while occupancy in the remaining markets is expected to dip.
• ADR in the Gateway markets will benefit from the Super Bowl (San Francisco) and World Cup (San Francisco, Los Angeles) in 2026. These major events will contribute to 2.7% rate growth in the Gateway markets versus 1.0% growth elsewhere.
• While demand growth is projected to be relatively even across Gateway and non-Gateway regions in 2026, stronger rate growth in Gateway markets will lead to comparatively higher RevPAR and revenue gains.