NEW YORK–The Hotel Monitor 2019, published by American Express Global Business Travel (GBT), finds geopolitical factors along with global, regional, and local economics are driving a diverse range of conditions for those negotiating hotel rates in key business destinations. Created by the Global Business Consulting team at GBT to support buyers ahead of the hotel request for proposal (RFP) season, the report listed several insights and included a 2019 pricing forecast for 150 key cities around the world.
Global Uncertainty Impacting Travel Policies and Demand
Traveler security and political unrest are expected to be catalysts for significant rate fluctuations globally, and demand for more security-compliant properties is growing–particularly in upscale hotels. Global policy trends, such as Brexit and changes to the NAFTA trade agreement, are also expected to impact trade and travel activities.
Hotel Rates Rising Alongside Flourishing Regional Economies
The Asia Pacific region is anticipated to account for nearly two-thirds of global growth, with around 5.6 percent GDP growth in 2018 and 2019. This is reflected in projected hotel rate increases, and the Hotel Monitor finds similarly moderate rises in Latin America where the economy continues to improve.
Hoteliers Striving to Keep Pace with Increased Demand
Globally, growing demand for hotel supply often outpaces room availability. Limited supply growth combined with steady demand is boosting rates in many European destinations. However, in the Middle East, over-supply and other factors are pushing prices down in some Gulf states. North American hoteliers report increases in bookings and revenues, partly driven by strong business travel and group growth; rates are predicted to rise across the continent.
“As we enter hotel RFP season, overarching global and market tendencies will play a critical role in the operational and financial success of travel programs,” says Joakim Johansson, vice president of business development, American Express GBT. “Reviewing how others have adapted to changing business conditions provides an important opportunity to identify best strategies and ensure time and resources are utilized in the most cost-efficient way possible.”