San Antonio Business Journal: Hotel investors ‘bullish’ on SA despite new red flags

The San Antonio Business Journal dropped a new article about the conflicted state of San Antonio’s lodging industry. Demand has been weak, but hotel developers still see that the market has an upside. In the article, Hotel investors ‘bullish’ on SA despite new red flags, journalist Scott Bailey notes the soft demand in San Antonio’s most important hotel market even as new hotels open and more loom on the horizon.

The article, subtitled “SA’s lodging industry has been among the hardest hit major Texas markets post-pandemic”, notes how all of the large Texas metros have had challenges over the last year, but San Antonio has been hit especially hard:

Texas’ largest markets have seen demand for hotel bookings drop considerably, with San Antonio, heavily invested in the tourism industry, taking one of the biggest hits.

Yet hotel developers continue to have a vested interest in the Alamo City despite the red flags.

The Business Journal brings the context with data from the Source Strategies team:

San Antonio hotels sold 2.46 million room nights in the fourth quarter of 2025 — about 220,000 fewer than in the same period the previous year.

The reduction in bookings cost San Antonio hotel owners nearly $25 million in revenue, down 7% from $366.7 million in Q4 2024. No other major Texas metro took as large a hit.

Overall occupancy, a telling sign in the hotel industry, was down more than 5% toin the quarter versus the same period the previous year, according to new data from Source Strategies.

Source Strategies’ Director of Data Operations, Paul Vaughn, provided additional context to help understand the numbers:

“Demand was down in all submarkets except for the West/Seaworld area,” Source Strategies’ Paul Vaughn said, adding there were “few bright spots.” 

After briefly touching on the opening of Zachary Hospitality‘s new Monarch San Antonio, Bailey also got additional perspective from San Antonio Visitor Alliance President and CEO Bill Brendel:

Still, the post-pandemic challenges are not lost on industry stakeholders.

“It’s been a minute since many were able to sustain high occupancies where the hotel profitability is best,” San Antonio Visitor Alliance President and CEO Bill Brendel said. “Many are desperate for those times to return. Until then, you have to operate with minimal staffing and pinch every penny.” 

The article concludes on an upbeat note:

Yet investors have continued to add more properties. The city’s room supply grew by nearly 7% over the final three months compared to the Q4 2019 inventory. More projects are in the works, including IBC Bank’s plans to convert an office building on East Houston Street into a new 300-room hotel.

“Well-financed developers seem to remain bullish on San Antonio,” Brendel said, noting that the city may have an opportunity to lure more business from Austin and Dallas as those markets rework their convention center facilities. 

Read the full article, Hotel investors ‘bullish’ on SA despite new red flags, on the San Antonio Business Journal website.