Hotel revenues jump as consumers pay more
The nation’s COVIDbattered hotel industry is on the rebound, with leisure travel revenue in the top 50 U.S. markets expected to exceed prepandemic levels of 2019, according to a national industry trade group.
But that translates into consumers paying more. All year, industry officials have noted that improving hotel revenues have meant higher prices for consumers as the industry struggled to snap back from a devastating travel slowdown that started in early 2020 and started to rebound last year.
“The hotel industry continues its march toward recovery, but we still have a way to go before we fully get there,” said Chip Rogers, president and CEO of the Washington, DC.based American Hotel and Lodging Association, in a statement.
Peter Ricci, director of the hospitality and tourism management program at Florida Atlantic University, said 2023 will be another year of lofty prices for hotel guests as managements wrestle with high labor and energy costs, shifting travel patterns and recession fears.
“The opportunity to reduce rates is restricted beyond anybody’s control because they have to pay the bills,” he said.
Among the top 50 U.S. markets, 80 percent are projected to see leisure travel revenue exceed 2019, while only 40 percent are expected to reach that milestone for business travel revenue, the hotel association said in the statement.
Nationally, leisure travel revenues among the top 50 destinations are expected to come in slightly short of $100 billion at $97.8 billion for an increase of 14 percent over 2019, the association said. The business side will be off by 1percent.
New York — with its $5.4 billion leisure market and $3 billion in business travel revenues — leads the top 50 list, despite an expectation that it will lose ground to pre-pandemic levels in both categories.
Orlando, Fla., with its popular Walt Disney World Resort and other theme park destinations, was at No. 5 with a projection of slightly above $4 billion in leisure revenues, up 24.6 percent from 2019. Business travel revenues were expected to rise 23.1 percent to $2.329 billion.