Pricing power in the global hotel industry has led the recovery from the COVID-19 pandemic, and hoteliers expect it will be sustainable this year, according to a survey by STR.
In specific markets where hotel occupancy has lagged, higher rates have helped to grow or keep revenue steady. Rate growth showed some signs of moderating at the end of 2023, but STR's latest forecast for 2024 still has rates growing by 3%.
In the Hospitality Industry Sentiment survey, a quarterly study assessing the experiences and expectations of hotel and travel professionals around the globe by CoStar hospitality analytics firm STR, most hoteliers agreed.
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Unlike the outlook for hotel demand, hotel average daily rate expectations for next year are less affected by concerns over labor and supply-chain challenges or recession fears.
In STR's survey, more than 60% of respondents anticipate at least 1% to 2% growth in hotel rates year over year for the first quarter of 2024; and nearly a third of respondents put their predictions at 3% to 4% growth or higher.
By the end of 2024, the proportion swells to 70% of experts predicting rate growth.
For more insights or to participate in the Hospitality Industry Sentiment survey, click here.
Brannan Doyle is a senior research analyst at STR, CoStar's hospitality analytics firm.