• The average daily room rate (ADR) for U.S. luxury hotels reached a record $394, creating the largest price gap ever over the next-priciest hotel tier.
• Demand for luxury properties remains strong, with bookings up 2.5% through September, despite general declines in foreign tourism.
• The market includes an “ultraluxury” segment where prices are often more than double the typical luxury rate, such as $1,560 in New York City.
• High-end hoteliers like Montage International are doubling their portfolio due to strong demand for exclusive experiences, large suites, and multigenerational trips.

The U.S. lodging industry is reflecting an increasingly polarized economy, characterized by record-high prices for luxury hotels that have not deterred affluent travelers. The average daily room rate (ADR) at a U.S. luxury hotel is currently a record $394, marking a widening gap of $168 over the next priciest hotel tier. This disparity is the largest ever recorded, having grown sharply in recent years.

Despite a decline in foreign tourism and job uncertainty among white-collar workers, wealthy travelers, whose fortunes have been boosted by stock market and real estate gains, continue to spend freely. Bookings for U.S. luxury properties were up 2.5% through September, contrasting with a slight demand drop for lower-scale hotels during the same period. This seemingly unshakable demand is driving expansion among high-end hoteliers; Montage International, for instance, plans to double its portfolio size in the next three to five years, primarily expecting American guests.

The market includes an “ultra-luxury” segment, where the top 10 most expensive hotels worldwide often charge more than double the typical luxury hotel rate; for example, ultra-luxury rooms in New York cost $1,560 compared to the average luxury rate of $472. This segment is further fueled by wealthy Americans splurging on experiences like travel and increasingly popular multigenerational trips that favor large villas and suites. Hotels maintain this premium by focusing on exceptional, personalized service, exemplified by properties like Corinthia’s Surrey hotel, where staff are trained to anticipate guest needs and maintain rigorous service standards.