The hotel industry is undergoing significant changes, with business travel and groups emerging as the strongest-performing segments. Hyatt Hotels Corp. CEO Mark Hoplamazian noted that corporate accounts have grown by 12% this year, while the business travel segment has increased by 6%. Accor CEO Sebastien Bazin also discussed securing significant rate hikes during annual renegotiations with global corporate accounts.
Marriott International CEO Anthony Capuano pointed out that groups are currently the strongest-performing segment in the industry. Group clients are looking to book years in advance to secure the dates, space, and cities they desire. However, lending for new construction has decreased, leading to increased competition for conversions.
IHG Hotels & Resorts CEO Elie Maalouf emphasized the need for creativity in the industry, with some developers considering unconventional projects such as converting office buildings into hotels. While this type of conversion can be costly and challenging, it is a viable option given the strong demand for accommodations in key locations.
Scarce new hotel supply is also driving demand up due to historically low supply growth over the next few years. With limited new development getting funded, Hilton CEO Christopher Nassetta predicts a historically low supply growth over the next few years, which will drive demand up even further.
Overall, these trends present both challenges and opportunities for hoteliers to adapt and innovate in response to evolving consumer needs and market conditions. Hotel executives at the NYU International Hospitality Industry Investment Conference discussed these changes in detail and provided insights on how hoteliers can navigate this changing landscape effectively.
