Canada Projects Moderate Hotel Growth for 2027

CBRE Hotels reports national industry growth is driven primarily by average daily rate increases.

Updated on Oct. 29, 2026 in Hotels

Screen-print poster illustration of a minimalist hotel building facade, evoking the steady growth and heritage of the Canadian hospitality industry. — CBRE Hotels projects 2.2 percent national revenue growth for the Canadian hotel sector in 2027, driven primarily by higher average room rates. AI Illustration. Upload story photo >

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CBRE Hotels released its 2027 Canadian hotel industry outlook at the Ontario Hospitality Conference held on October 19-20, 2026. The firm forecasts a 2.2 per cent national growth in revenue per available room (RevPAR) for the coming year.

Why it matters

The hotel sector faces persistent profitability pressure from rising expenses in labour, insurance, property taxes, and food costs. While domestic demand remains steady, operators must navigate these increased operating costs while managing workforce recruitment challenges.

CBRE forecasts national RevPAR growth of 2.2 per cent for 2027, with many specific Canadian markets expected to see growth between 3 per cent and 5 per cent. In contrast, Toronto is projected to experience growth of approximately 1 per cent.

The players

CBRE Hotels

This global commercial real estate services firm specializes in hospitality consulting and provides data-driven research on market performance.

Sheraton Parkway Toronto North Hotel & Suite

This facility served as the host venue for the 2026 Ontario Hospitality Conference.

The details

Industry experts note that growth is currently fuelled by higher average daily rates rather than occupancy gains. New supply is largely developing in suburban and central areas rather than major urban centres, with national supply and demand expected to remain balanced through 2028.

August 2026 marked the end of the tracking period for Ontario RevPAR growth.
The Ontario Hospitality Conference was held on October 19-20, 2026.
2027 is the forecasted year for Canadian hotel performance metrics.
2028 serves as the long-term outlook period for market supply balance.

Travel Outlook

This outlook aligns with the historical balance of supply and demand in the Canadian hospitality sector. The report anticipates that current development trends will maintain this equilibrium through 2028.

Travellers should anticipate higher nightly room rates across most Canadian markets as hotels pass on rising operating costs to guests. Those booking travel for 2027 may find more room inventory in suburban and central areas as new supply continues to shift away from major urban centres.

The takeaway

The hospitality industry is relying on room rate increases to sustain growth against rising operational expenses. Guests should prepare for higher costs while monitoring shifting supply patterns in emerging regional markets.