A strong winter season gave Ottawa the highest boost in hotel occupancy of any major Canadian city last year, according to a new report from Avison Young.
The report, which reviewed hotel industry performance in 2025 and provided predictions for 2026, found that the occupancy rate in the Ottawa-Gatineau region rose to 70.6 per cent, a 2.3 per cent increase year-over-year.
“Ottawa, of the major markets we’ve identified in our report, was the strongest in terms of occupancy growth, hitting that 70 per cent level,” Curtis Gallagher, partner and Canadian hospitality lead for Avison Young, told OBJ on Tuesday.
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The Canadian average was 66.1 per cent occupancy, a 0.7 per cent increase year-over-year.
The occupancy bump in 2025, according to Gallagher, represented a continued slow return from record lows in the hospitality sector during the COVID-19 pandemic.
In Ottawa, he said the factors that have always made the city a successful tourism destination have now fully or almost fully recovered.
“It has so many diverse demand generators: sporting events, festivals,” he said. “Plus, there are things doing better in Ottawa generally. Business is back, conferences are back, the government has normalized. The canal was open again, so you could skate and participate in the winter festival. That makes Ottawa, and Gatineau, very, very attractive.”
There were also new factors that Gallagher said strengthened domestic interest in the capital.
“You’ve got the opinion of many Canadian travellers to stay out and not travel down to the U.S.,” he said. “And Ottawa is a very attractive market to visit again or go to for the first time.”
Occupancy rates were not the only performance indicator that improved in Ottawa last year. The average daily rate (ADR) per room rose 3.6 per cent to $205.56.
The overall ADR in Canada rose 3.5 per cent to $216.10. Winnipeg saw the largest increase in ADR, rising 7.9 per cent to $183.05.
According to Gallagher, although occupancy rates and ADR took significant pandemic hits across the country, occupancy recovered to pre-pandemic levels in 2024 and remained steady last year.
When a city like Ottawa sees a strong occupancy rate, he said it can create increased confidence and allow hotels to hold or increase their rates.
“That’s where we are now, heightened and normalized, just under the pre-pandemic record high occupancy, but way beyond in terms of rates,” he said. “So a very healthy industry, resilient through the pandemic and supported by the government.
Ottawa recorded a RevPAR (revenue per available room) of $145.02, an increase of six per cent. The metric, Gallagher said, accounts for both occupancy and ADR, and is the best benchmark for assessing hotel performance. Ottawa’s RevPAR, he said, indicates a solid performance for a mid-sized city.
“It’s exactly typical,” he said. “You and I, as leisure travellers, might pay more than that. But when you look at all the government contracts and the corporate, pre-negotiated rates in a city like Ottawa, it averages out to that level. Everything in there looks in line.”
Calgary saw the largest increase in RevPAR, rising 8.3 per cent to $124.67.
In 2025, major Canadian markets also recorded more than $1.3 billion in hotel transactions, an increase of three per cent from 2024.
Two local transactions were highlighted in the report, including the Hampton Inn & Suites in Nepean, a 102-room hotel that sold for $24 million last March, and the Ottawa Embassy Hotel & Suites in Centretown, a 140-room hotel that sold for $32.5 million in April.
In Ottawa, Gallagher said the hotel sector can typically expect to see a handful of properties change hands each year, and those two sales are representative of those types of transactions.
While 2026 may already be outpacing 2025 — with the longest Rideau Canal Skateway opening since the 2018-2019 season — Ottawa’s hotel industry isn’t expecting any sizable swings this year.
“We see 2026 being a continuation of what happened in 2025 and a little bit better,” said Gallagher. “Nothing dramatic in terms of occupancy, no real new supply issues that are going to dramatically impact appeal to buy. The issue is more for buyers. If you’re getting healthy income generated from that asset, why would you sell it?”
