Canada’s hotel industry, steadily making its way back from the disastrous pandemic years in which revenues plummeted by an estimated 80 per cent in 2020, was one obvious beneficiary of “the Swift effect,” with Taylor Swift’s record-shattering Eras Tour reverberating beyond the music world.
The influx of so-called Swifties added fuel to an ongoing debate about whether major Canadian cities have enough hotels to meet such peaks in demand, especially as demand in general is increasing.
Adam Jacobs, national head of research at Colliers International Group Inc., said a unique confluence of factors is fuelling the sector’s growth. “We’re seeing a hospitality renaissance,” he said. “Cultural megastars like Swift are catalysts, but the rebound is part of a broader trend of pent-up demand for experiences.”
Jacobs said the hotel sector is benefiting from a rise in leisure travel, as well as from corporate and event-related tourism. In cities such as Vancouver, the challenge of meeting rising demand has become a hot topic.
The limited availability of land in downtown Vancouver has made competition for prime real estate intense. “Developers are vying for locations that could easily become office towers or condos instead,” Jacobs said. “Hotels get squeezed out, making the market for existing properties very competitive.”
He said the limitations on new construction have created an active investment market, with buyers increasingly choosing to acquire existing hotels or bundled portfolios of multiple properties sold as a single investment opportunity.
Hotels across Canada performed exceptionally well in 2024, with occupancy reaching record levels not seen since 2018 — 20 per cent above pre-pandemic rates — according to Laura Baxter, director of hospitality analytics at CoStar Group Inc.
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