HVS Report – Federal Per Diem Set for 2024/25: A Win for the Lodging Business

The per-diem lodging charges, which set the utmost quantity a federal traveler can reimburse, are based mostly on the common charges for mid-priced motels. The just lately revealed per-diem charges for the 2025 fiscal 12 months present will increase for the general continental United States.

The federal authorities per-diem price is made up of a lodging allowance, a meals allowance, and an incidental expense allowance. The per-diem lodging charges, which set the utmost quantity a federal traveler can reimburse, are based mostly on the common charges for mid-priced motels and are set yearly by the U.S. Common Providers Administration (GSA).

Because the 2005 fiscal 12 months, federal lodging per-diem charges have been based mostly on native common every day price (ADR) information, much less 5.0%. The charges are up to date yearly, with the subsequent fiscal-year charges revealed in mid-August. For the 2025 fiscal 12 months starting October 1, 2024, the usual every day lodging allowance for the continental United States (CONUS) will enhance to $110 per day (beforehand $107), and the meals and incidental expense (M&IE) allowance will enhance to $68 per day (beforehand $59).

As revealed by the GSA, the three components that affect the federal lodging price and will end in per-diem charges that differ from revealed market charges are listed beneath:

• Property Choice Standards: The aim of the GSA is to decide on properties greatest representing mid-range motels in every market utilizing standards resembling location, fire-safe certification, and numerous property demographics.
• Time Body of Information: The GSA makes use of ADR information from the trailing April–March interval.
• Seasonality: Seasonal charges are created by the GSA in lots of markets which have a sustained interval (two or extra months) the place charges range by at least 15% from the previous or following interval, based mostly on three years of knowledge.

Moreover, larger, particular person per-diem charges are set for various areas, known as non-standard areas (NSAs), which might be ceaselessly visited by federal staff. For instance, the GSA has set particular person per-diem charges for seven NSAs in Maryland: Aberdeen/Bel Air/Belcamp, Annapolis, Baltimore, Cambridge/St. Michael, Centreville, Columbia, and Ocean Metropolis. As of the 2025 fiscal 12 months, the GSA stories a complete of 296 NSAs throughout the nation. Every NSA could also be additional delineated if there’s a important quantity of seasonality.

Some modifications for NSAs within the 2024/25 interval when in comparison with 2023/24 charges embody the next:

• The M&IE breakdowns for NSAs have seen the biggest enhance, with some NSAs or seasons nearing a 35% enhance over final 12 months’s charges.
• Seasonality modifications have taken place in various NSAs. Some examples are as follows:

  • Aspen, CO, has modified from a five-season market to a three-season market.
  • Manchester, NH, has modified from a three-season market to 1 single per-diem price.
  • Yosemite Nationwide Park, CA; Boise, ID; and Augusta, GA, have every elevated in seasonality from one price to a few separate seasons.

• The biggest enhance and reduce in lodging allowance for any single market (with out seasonality parts), respectively, had been Athens, GA (an over 13% enhance), and Carlsbad, ND (an virtually 27% lower).
• Six NSAs from 2023/24 had been moved to the usual CONUS price for 2024/25: Ft. Wayne, IN; Canton, OH; Mentor, OH; East Greenwich/Warwick, RI; Waco, TX; and Wisconsin Dells, WI.

Whereas federal journey might not symbolize a big supply of demand in many areas all through america, the charges nonetheless present a number of lodging indications, resembling year-over-year fluctuations, market seasonality, and demand shifts. From a lodge advisory and valuation standpoint, in markets with sturdy federal authorities journey, probably the most just lately revealed per-diem charges and the seasonality modifications are important concerns within the evaluation and growth of the lodge’s professional forma or income projections.

To talk to our native specialists about your lodge market’s per-diem price modifications and the lodging indications they reveal, please attain out to Chelsey Leffet.

About Chelsey Leffet

Chelsey Leffet is Managing Director and head of the Northeast area of the U.S. for the Consulting & Valuation division. Chelsey has consulted on a whole lot of motels all through the Mid-Atlantic, together with main Beltway markets. Previous to becoming a member of HVS, Chelsey labored in visitor providers, operations, and restaurant roles at ARAMARK Increased Schooling; Lighthouse Resort Providers in Corolla, North Carolina; the Columbus Inn in Wilmington, Delaware; and the Bellmoor Inn and Spa in Rehoboth Seaside, Delaware. Chelsey earned her BS in Hospitality Administration and her MBA from East Carolina College. Chelsey resides in Washington, D.C and is an authorized normal appraiser. Contact Chelsey at (202) 434-8793, or cleffet@hvs.com.