The USA extended stay hotel industry is growing due to increased business travel, relocations, and changing consumer preferences. Corporate travelers, relocating professionals, and medical tourists are key drivers. Brands like Hyatt House and Residence Inn cater to these guests with quality amenities and convenient accommodations.
NEWARK, DE / ACCESS Newswire / February 19, 2025 / The global extended stay hotels market is expected to reach USD 62.8 billion by 2025, with a strong compound annual growth rate (CAGR) of approximately 8.6% from 2025 to 2035. This growth reflects the rising demand for flexible, comfortable, and affordable long-term accommodation options.
By 2035, the market is projected to grow to USD 143.2 billion, driven by factors such as the increase in business travel, the rise of remote work, and the growing number of tourists and relocating professionals seeking home-like amenities during their stays. These trends are shaping the future of extended stay accommodations as a preferred lodging choice.
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Key Factors Driving Growth in the Extended Stay Hotels Market
Rising Business Travel
As global business activities increase, more professionals are seeking long-term accommodation for extended work assignments, conferences, and projects. Extended stay hotels provide the convenience of home-like amenities, such as kitchens and workspaces, which cater to business travelers' need for comfort and productivity during their stays.Growth in Remote Work and Digital Nomadism
The rise of remote work and the digital nomad lifestyle has led to an increasing number of individuals seeking flexible, long-term accommodation options. Extended stay hotels offer the perfect solution for remote workers and digital nomads who require a comfortable and affordable place to stay while working from different locations around the world.Tourism and Relocation Trends
The growth of global tourism, along with the rising number of people relocating for work or personal reasons, has contributed to an increased demand for extended stay options. These travelers seek accommodations that offer more space and better amenities compared to traditional hotels, making extended stay hotels an attractive option for long-term stays.
Regional Insights into the Extended Stay Hotels Market
USA: The extended stay hotel industry in the USA is booming, driven by increased business travel, relocation trends, and the rise of remote work, with cities like Dallas, Houston, and Chicago seeing high demand for long-term stays offering quality amenities and workspaces.
Germany: Germany's extended stay hotel market is on the brink of a revenue boom, fueled by corporate travel, relocation, and medical tourism, with professionals, expatriates, and medical tourists opting for flexible, affordable accommodations in cities like Berlin, Munich, and Frankfurt.
Key Takeaways from the Extended Stay Hotels Market
The market is expected to grow at a compound annual growth rate (CAGR) of 8.6% from 2025 to 2035.
Business travel is a major driver of demand for extended stay accommodations.
The rise of remote work and digital nomadism is fueling the market's expansion.
Extended stay hotels offer cost-effective, flexible solutions for long-term travelers.
Increasing tourism and relocation trends are contributing to market growth.
North America remains the dominant region for extended stay hotels, with significant growth in Asia-Pacific and Europe.
"With more travelers seeking flexibility in terms of length of stay and quality of amenities, extended stay hotels have emerged as a popular choice. The trend toward remote work and business relocation is expected to further accelerate this demand, with travelers seeking longer, more cost-effective lodging solutions." - says Sudip Saha Managing Director and Co-Founder at Future Market Insights.
Prominent Drivers of the Extended Stay Hotels Market
Medical Tourism Growth: As medical tourism continues to grow, patients and their families often require long-term accommodations near treatment centers, boosting demand for extended stay hotels.
Rising Tourism: With the increasing popularity of extended vacations and seasonal travel, tourists are opting for extended stay hotels that offer both comfort and convenience.
Increased Project-Based Work: Professionals working on long-term projects, such as construction, engineering, or tech assignments, require accommodations that provide home-like amenities for extended stays.
Convenience for Families: Extended stay hotels cater to families by offering spacious rooms, kitchens, and amenities that make longer stays more comfortable and affordable.
Enhanced Hotel Services: Hotels offering better services, such as fully equipped kitchens, on-site laundry, and fitness facilities, are attracting more long-term travelers seeking a comfortable living space.
Urbanization: With more people moving to urban areas for work or studies, the need for affordable long-term accommodation options is increasing, benefiting the extended stay hotel market.
Sustainability Trends: The demand for eco-friendly, sustainable accommodation is rising, and extended stay hotels that implement green practices are becoming increasingly popular among environmentally conscious travelers.
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Challenges Faced by Extended Stay Hotels Market
Intense Competition: The growing number of extended stay hotels has led to heightened competition, making it challenging for individual properties to differentiate themselves and maintain consistent occupancy rates.
Fluctuating Demand: Extended stay hotels often face seasonal demand fluctuations, with periods of low occupancy impacting revenue generation, especially in non-peak travel seasons.
Evolving Consumer Expectations: As consumer preferences shift, extended stay hotels must continuously adapt to meet new demands for technology, comfort, and personalized services, requiring ongoing investment.
High Operational Costs: The costs associated with providing amenities like kitchens, fitness centers, and laundry facilities can lead to high maintenance expenses, affecting the profitability of extended stay hotels.
Economic Uncertainty: During economic downturns or periods of uncertainty, both leisure and business travelers may reduce spending on long-term stays, resulting in lower demand for extended stay accommodations.
Regulatory Compliance: Navigating local zoning laws, health and safety regulations, and tax requirements can be complex for extended stay hotel operators, particularly when expanding to new regions or countries.
Managing Long-Term Guests: Extended stay hotels must effectively manage the expectations of long-term guests, ensuring satisfaction and addressing unique needs over extended periods, which can be resource-intensive.
Competitive Landscape of the Extended Stay Hotels Market
The competitive landscape of the extended stay hotels market is characterized by a variety of operators offering accommodations tailored to the growing demand for long-term stays. Competitors differentiate themselves through location, pricing, amenities, and exceptional customer service, with a focus on providing home-like environments featuring fully equipped kitchens, workspaces, and laundry facilities to attract business travelers, relocating professionals, and families.
To stay competitive, market players are adopting advanced technologies like digital check-ins and smart room features to enhance guest experiences. Additionally, sustainability practices are becoming increasingly important, as operators cater to environmentally conscious travelers. As the remote work and digital nomad trends continue to rise, companies are adapting their offerings to meet the evolving needs of both leisure and business travelers.
Recent Developments in the Extended Stay Hotels Market
April 2024 - Wyndham Hotels & Resorts expanded into the upscale extended stay segment by partnering with WaterWalk. This agreement added 11 hotels and over 1,500 rooms to Wyndham's portfolio, rebranding them under the newly created WaterWalk Extended Stay by Wyndham.
January 2024 - Choice Hotels International launched Everhome Suites, a midscale extended stay brand offering flexible and affordable accommodations. The brand introduced customizable room configurations and modern amenities to attract long-term travelers.
September 2023 - Hilton Worldwide introduced Project H3 by Hilton, a new extended stay brand targeting budget-conscious travelers. Hilton aims to open hundreds of these properties in the coming years, focusing on simple and comfortable long-term stays.
Key Companies Profiled
Extended Stay America, Inc.
Marriott International
Hilton Worldwide
IHG Hotels & Resorts
Hyatt Hotels Corporation
Choice Hotels International
Wyndham Hotels & Resorts
Sonesta International Hotels Corporation
Aimbridge Hospitality Red Roof Inn
Staycity Group
SACO
Roomzzz Aparthotels
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Extended Stay Hotels Market Segmentation
By Room Range:
Economic Range
Middle Range
Luxury Range
By End User:
Travellers
Corporate Professionals
Management Trainees
Students
By Stay Duration:
Long Term
Monthly
Weekly
Daily
By Booking Channel:
Online Booking
In-Person Booking
Phone Booking
By Tourist Type
Domestic
International
By Demography:
Men
Women
Children
By Age Group:
15-25 Years
26-35 Years
36-45 Years
46-55 Years
66-75 years
By Region:
North America
Eastern Europe
Western Europe
East Asia
South Asia and Pacific
Latin America
Middle East and Africa
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Future Market Insights, Inc. (ESOMAR certified, recipient of the Stevie Award, and a member of the Greater New York Chamber of Commerce) offers profound insights into the driving factors that are boosting demand in the market. FMI stands as the leading global provider of market intelligence, advisory services, consulting, and events for the Packaging, Food and Beverage, Consumer Technology, Healthcare, Industrial, and Chemicals markets. With a vast team of over 400 analysts worldwide, FMI provides global, regional, and local expertise on diverse domains and industry trends across more than 110 countries.
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