The strength of hotel performance in Q1 2026 has surprised many in the industry, as the momentum of growth has continued into the first three months of the year. Nationally, revenue per available room (RevPAR) increased by 6.8% in Q1, setting a positive tone for the months ahead. Current indicators suggest a favourable outlook for both Q2 and Q3.
This summer, the Canadian market is well positioned to continue to benefit from shifting travel patterns, including reduced outbound travel to the U.S. by both Canadians and international visitors. At the same time, overseas travel by Canadians may be tempered by elevated costs and ongoing geopolitical uncertainty in the Middle East.
Based on year-to-date performance, it is increasingly likely that earlier growth forecasts will prove conservative.
Industry sentiment remains highly optimistic, as reflected in discussions among panelists at the recent Canadian Hotel Investment Conference and Capital Program. Developers and investors are viewing new supply opportunities more favourably, supported by declining land and construction costs across several major markets over the past 2-3 years. In addition, capital availability remains strong, providing further momentum for continued investment and expansion within the sector.
