The widening performance gap across U.S. hotel brands is becoming about more than RevPAR.
Luxury and upper-upscale hotels continued to pull away from lower chain scales during the first half of 2026, according to Colliers’ latest U.S. Hospitality Brand Performance Comparison report. Luxury RevPAR increased 13.3% year-over-year, while economy was the only chain scale to record declines in occupancy, ADR and RevPAR.
For hotel investors, the question is how much of that outperformance translates into higher NOI and asset values.
Mark Owens, vice chair and leader of the Hospitality Practice Group at Colliers, said that depends heavily on the market. Hotels operating near full occupancy have more pricing power, but rising insurance, real estate and other costs can limit how much revenue growth reaches the bottom line.
“With inflation, insurance, and real estate costs escalating, a disciplined approach to underwriting is important,” he said. “In typical cycles, incremental flow-through to NOI can be as high as 70–80%, though this is heavily market-dependent.”
Stronger performance attracts more capital
Colliers found premium, lifestyle and destination-oriented hotels continued to capture strong rate growth, while lower-tier hotels faced pressure from budget-conscious travelers and recent supply additions.
Hilton reported 4.7% U.S. RevPAR growth, Hyatt posted 5.7% systemwide growth, IHG increased RevPAR 4.8% in the Americas, and Marriott’s U.S. and Canadian portfolio grew 4.6%.
Owens said location, sponsorship, branding and asset quality remain important across chain scales. But luxury, upper upscale and lifestyle assets are also benefiting from a well-capitalized buyer pool that includes high-net-worth families, institutions and REITs.
“Better flow and increasing NOIs lead to increased overall valuation levels and more appetite from investors who are yield-driven,” he said.
Brand momentum and conversion potential create value
Some of the report’s biggest gains came from lifestyle and experience-oriented brands. IHG’s Atwell Suites led with 22.7% RevPAR growth, followed by Kimpton at 15%, Hilton’s LXR Hotels & Resorts at 12.9%, Hyatt’s Unbound Collection at 12% and Marriott’s W Hotels at 10.8%.
Owens cautioned that newer lifestyle brands can produce higher percentage growth partly because they have fewer units and a smaller comparison base. For investors, what matters more is whether that momentum can continue.
“Ultimately, the investment is tied to the buyer’s belief in the concept’s growth,” he said. “If, for example, New Brand A is having strong traction in other markets, a premium may be applied by a buyer as they expect this to occur with their acquisition. Alternatively, if another brand’s performance is moving backward, investors may discount their underwriting, thus impacting their valuation.”
There can also be great value in changing a property’s positioning.
“The newer lifestyle brands are seeing increased RevPAR growth because of fewer units in their reservation systems versus some of the more established brands that have a larger baseline from which to benchmark,” Owens said. “We are able to push value more aggressively today when there are opportunities to convert or reposition hotels and resorts”
Today’s laggards could become tomorrow’s opportunity
Continuing the bifurcation trend in hospitality over the past few years, economy remains the weakest chain segment, while recent supply has also pressured lower-tier hotels. Colliers said economy and upper-midscale deliveries peaked in mid-2025 and midscale deliveries peaked in early 2026.
But Owens said some markets have already absorbed that supply and could be positioned for a rebound. An inventory of properties could also create acquisition opportunities as lenders and investors eventually confront troubled assets.
“With an abundant supply of undercapitalized and under-renovated properties in this segment, there is likely to be tremendous opportunity if and when lenders and investors need to realize losses,” he said.