In Tysons, hotels have made progress on recovering from the blows dealt to the hospitality industry by the pandemic, but occupancy levels are leveling out instead of continuing to rise, the Tysons Community Alliance (TCA) shared in its most recent quarterly report.
Released last Wednesday (Dec. 17), the Q3 2025 market report found that the hotels in Fairfax County’s urban center were about 70% occupied, on average, from November 2024 through this past October — the same rate recorded over that time period a year earlier.
That is a significant increase from the year COVID-19 emerged, which saw average occupancy levels dip below 40% between November 2019 and October 2020. However, in the three years prior to the pandemic, Tysons hotels averaged annual occupancy rates of 72-74%, according to the report.
While occupancy has held steady over the past year, the cost of a hotel room has ticked up. Daily rates for January 2025 through September averaged $197.24 — a 4% increase from that period in 2024 — and have now surpassed pre-pandemic prices, which were closer to $175.
In addition, hotels are generating an average of $138.97 in revenue per available room, up 7% year-to-date.
“While not adjusted for inflation, these gains highlight the market’s continued ability to command higher rates,” the TCA said in the Q3 report.
Tysons has a total of approximately 3,900 rooms across 16 hotels, including two that have opened since the pandemic — the Watermark Hotel at Capital One Center and Archer Hotel in Scotts Run. It also lost the Sheraton in 2020, one of a few hotel properties in Fairfax County that have undergone or are considering residential conversions.
Tysons’ flat occupancy rate stands in contrast to a 2% year-over-year drop for the D.C. region as a whole, which has faced a number of unanticipated economic challenges this year, from federal workforce cuts and a government shutdown to lower-than-expected attendance at cultural events like the WorldPride Festival and Kennedy Center concerts in reaction to the Trump administration’s policies.
According to the TCA, hotel occupancy rates were about even at around 70% for both Tysons and the greater D.C. market in July, but in August, when Tysons had a 68% occupancy rate, D.C. saw a 6% drop — a gap that the report attributes to the deployment of more than 2,000 National Guard troops to the District.
“Visitors may have gravitated toward less contentious locations,” the TCA suggested.
Occupancy levels in Tysons remained a couple percentage points above the region in September and October too.
“Tysons’ hospitality sector continues to serve as a telling indicator of regional economic conditions, reflecting both the pressures facing the Washington metropolitan area and the strengths that help set Tysons apart,” the TCA said. “As one of Northern Virginia’s most active hotel markets, its performance offers a clear view of how business travel and visitor activity are evolving across the wider region.”
Though visitation remains 27% below 2019 levels, overnight trips to Tysons have increased 6% in 2025 from last year, a metric that includes people staying at short-term rentals or an acquaintance’s home as well as hotel guests, per the TCA’s report.
The most common point of origin for overnight visitors for this year to date has been New York City, followed by Richmond and Philadelphia, but more far-flung cities like Dallas and Los Angeles are also in the top 10.
“Looking ahead, TCA aims to better understand how these visitors choose their accommodations and the reasons behind their trips,” the report says.
Looking at other sectors, the market report shows slight upticks in vacancies for both housing and retail spaces in the third quarter of 2025, though demand for both remains high. About 93% of all residential are still occupied, and the retail vacancy rate is just over 1.5%.
Office vacancies remained at 20%, a rate that has persisted since the fourth quarter of 2024. Led by the Financial Industry Regulatory Authority’s leasing of 77,916 square feet at Valo Park (7950 Jones Branch Drive), the Tysons office market appears to be stabilizing based on the flat vacancy rate and rising average rents, which jumped past $37.50 per square foot for the quarter, the TCA’s report says.
“Tysons’ economic performance this quarter demonstrates resilience across all major sectors,” said report co-author Drew Sunderland, TCA’s vice president of strategy and research. “The surge in worker activity, continued strength of the hospitality market, and stability in commercial and residential developments all point to a community that is solidifying its role as a regional economic leader.”
