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EXTENDED-STAY ROOM revenue rose 3.4 percent in the first half of 2024 and 5.1 percent in the second quarter, while occupancy decreased 0.2 percent in the first half but increased 1 percent during the second quarter, according to The Highland Group. The second quarter also saw the highest quarterly RevPAR increase in a year, an 11-point occupancy premium over all hotels and the most rooms under construction in four years. The 2024 mid-year U.S. extended-stay Lodging Market report found that all three extended-stay hotel segments reported record-high room revenues in the first half and for the second quarter. Revenue growth in extended-stay hotels is accelerating in 2024, with the second quarter's increase more than three times that of the first quarter, the report said. The 5.1 percent revenue increase in the second quarter significantly outpaces the 3 percent gain reported for the overall hotel industry by STR/CoStar. "Despite headline grabbing large increases in extended-stay rooms under construction, the annualized increase in room nights available over the next year should be well below the long-term average and the near-term risk of over supply nationally is very low," said Mark Skinner, The Highland Group's partner.

APPROXIMATELY 6,095 PROJECTS with 713,151 rooms are in the U.S. construction pipeline at the end of the second quarter, according to Lodging Econometrics. This all-time high marks a 9 percent year-over-year increase in projects and an 8 percent increase in rooms compared to the second quarter of 2023. LE's Q2 2024 U.S. Hotel Construction Pipeline Trend Report revealed 1,171 projects with 147,611 rooms under construction at the end of the second quarter, reflecting a 10 percent increase in projects and a 4 percent increase in rooms year-over-year. LE expects that as interest rates decline, projects scheduled to start in the next 12 months will quickly move to under construction. Extended-stay brands remain popular with developers, comprising 36 percent of projects under construction, 33 percent of those starting in the next 12 months and 34 percent of projects in early planning, the report said. Sixty-four percent of these projects are in the middle tier of brands.