What's Happening?
Costa Rica's hotel industry is experiencing fluctuating performance trends, with high-end resorts outperforming other segments. This trend is influenced by a shift in traveler demographics and a reliance on American tourists. Over the past five years, high-end hotels and resort areas have shown robust performance, while mid-range and budget accommodations have stagnated. The composition of international travelers to Costa Rica has shifted, with an increase in American tourists and a decrease in travelers from other Central American countries. As of 2025, occupancy rates across Costa Rica have softened, even in areas benefiting from American tourism. Recent months have seen slight declines in room rates, marking the first decreases since the end of 2023.
Why It's Important?
Costa Rica's increased reliance on U.S. tourists makes it vulnerable to fluctuations in American travel demand. This dependency poses a risk to the country's hotel industry, particularly in high-end resort areas. However, there is potential for growth from European and Canadian markets, which could mitigate the impact of any slowdown in U.S. demand. The hotel industry must adapt to shifts in international travel patterns to sustain growth. By diversifying its tourist base and attracting visitors from Europe and Canada, Costa Rica can bolster its hotel sector against potential downturns in American travel demand.
What's Next?
Costa Rica's hotel industry faces challenges and opportunities as it navigates changing traveler demographics and economic conditions. The industry must focus on diversifying its tourist base to sustain growth. Efforts to attract visitors from Europe and Canada could help mitigate the impact of any slowdown in U.S. demand. Additionally, the industry may need to adapt its offerings to appeal to a broader range of international travelers.
