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The hotel business in Hartford is forecast to be a good performer for the rest of this year and into 2020, according to a new forecast by commercial real estate giant CBRE.

CBRE forecast revPAR in Hartford to increase by 3.4 percent in 2019, increase 0.2 percent in 2020, and decrease 0.7 percent in 2021 in its September Hotel Horizons report.

The report comes hot on the heels of two new hotel proposals in Hartford-area communities, a consultant’s recommendation that the Capitol Region Economic Development Authority build a 400-room hotel next to the Connecticut Convention Center in downtown Hartford and a report from CBRE forecasting that the state’s hotel sector will outperform the national one this year.

CBRE is also projecting a 0.9 percent supply increase and 2.5 percent demand increase in Hartford for 2019. In 2020 supply is expected to increase 0.8 percent and demand is expected to decrease 1.2 percent. Average daily rates (ADR) are also projected to climb in Hartford; rates are projected to grow 1.7 percent in 2019 and 2.2 percent in 2020. Occupancy is expected to increase by 1.6 percent and decrease by 2.0 percent in 2019 and 2020, respectively.

“Hartford’s ADR and supply are forecasted to continue to increase through 2021, while occupancy and demand will decrease in 2020 and 2021,” Mark VanStekelenburg, managing director of CBRE Hotels, said in a statement.

Nationally, CBRE projects GDP growth to average 1.9 percent during the second half of 2019. This is half the pace of growth during the first half of the year. In line with that, the report forecasts a deceleration in U.S. lodging performance during the final six months of 2019. After rising by 2.1 percent during the first half of the year, the pace of demand growth will slow to 1.4 percent for the balance of 2019. As a result, CBRE now forecasts the national occupancy level to decline by 0.2 percent from 2018 to 2019.

“While the economy continues to support revenue growth, the ability to achieve greater profits will be difficult,” a statement from CBRE noted. “With forecast revenue increases hovering around one percent, hotel operators will need to keep expense growth under 2 percent to achieve nominal gains in gross operating profits. This will be a challenge given that expenses have averaged 4 percent annual growth over the long run, and the labor market is tight.”