Hotels and Chains Report

Canada Hotels & Chains Report 2023

As the Canadian hospitality industry recovers from the challenges posed by the COVID-19 pandemic, the outlook for 2023 is optimistic.

This report provides an in-depth analysis of the Canadian hotel market, focusing on key performance indicators, the distribution of hotels by size and scale, and the dominance of both domestic and international hotel brands.

Key Performance Indicators for 2022

Occupancy: Canadian hotels saw an occupancy rate of 60% by the end of 2022, a significant recovery from the lows of 2020 (31%) and 2021 (40%).

Average Daily Rate (ADR): The ADR reached $182 in 2022, showing a 10% increase from the pre-pandemic levels in 2019.

Revenue per Available Room (RevPAR): The RevPAR stood at $109 in 2022, surpassing the 2018 and 2019 levels, indicating a strong recovery in the market.

Distribution of Hotels by Size

Small Hotels Dominate: 60% of Canadian hotels have fewer than 50 rooms, with 45% having fewer than 30 rooms. This highlights the prevalence of smaller establishments in the Canadian market.

Challenges for Franchising: Due to the small size of many hotels, the potential for franchising or branding is limited, with most global and Canadian brands requiring a minimum of 50 to 100 rooms for affiliation.

Distribution of Hotels by Scale

Independent vs. Branded Hotels: While 72% of hotels in Canada are independently operated, branded hotels account for 55% of the total guestroom supply, with an average of 121 rooms per establishment.

Dominance of Upper Midscale: The upper midscale segment represents the largest share of branded hotels, accounting for 33% of properties and 28% of guest units. This is followed by economy, midscale, and upscale brands.

Top Hotel Brands and Chains in Canada

Marriott International leads with 266 hotels and 55,578 rooms, followed by Wyndham Hotels & Resorts with 484 hotels and 39,220 rooms.

Top Brands by Room Count:

Holiday Inn Express: 114 hotels, 11,972 rooms.

Best Western Plus: 117 hotels, 11,764 rooms.

Comfort Inn: 141 hotels, 11,626 rooms.

Delta Hotels: 40 hotels, 10,398 rooms.

Fairmont: 19 hotels, 9,673 rooms.

Regional Insights

Ontario: Leads the market with 33% of total rooms, followed by Alberta (21%), British Columbia (17.5%), and Quebec (10.1%).

Top Destinations:

Toronto: Dominates with 18,768 branded hotel rooms.

Montreal: Leads in independent hotels with 105 properties and 7,809 rooms.

Pipeline Projects

A total of 326 hotel projects are in the pipeline, with Ontario leading the way. Toronto tops the list with 29 projects, accounting for 4,840 rooms. The next highest are Niagara Falls and Mississauga, with 2,904 and 1,740 rooms, respectively.

The Canadian hotel industry is on a path to recovery, with strong performance indicators and a growing pipeline of new developments. The dominance of small, independent hotels presents both challenges and opportunities, particularly in terms of branding and franchising potential. The presence of both domestic and international brands, coupled with a robust development pipeline, suggests a bright future for the Canadian hospitality sector.