Leisure demand is down year over year after a strong summer 2022 that was headlined by “revenge travel” out of the pandemic. But this shouldn’t be a cause of concern moving forward.
Priya Chandnani, vice president of revenue and distribution strategy at Pyramid Global Hospitality, said the dip in demand is more of a testament to the strength of last year than a weakness this year.
“If you were to look at 2019, in terms of demand, occupancies have still stayed consistent,” she said in an interview with Hotel News Now at the 2023 Hotel Data Conference. “Where we are seeing a decline is [average daily rate] to the prior year, and a lot of that has to do with the fact that last year was a great year.”
There was more outbound demand and spending on experiences and destinations in 2022 that is stabilizing this year, she said. Premium room types in Pyramid’s portfolio such as suites, bungalows and villas are the ones seeing a decline in rate, but rates remain elevated for other room types.
Group demand, however, has been “amazing” for Pyramid this year and is projected to be even stronger in 2024.
“I do think that 2024 will be the year for groups. The focus for us is layering in that group effectively, so finding pockets where we truly need the group demand to be able to continue to leverage our transient rate efficiency,” she said.
Listen to the podcast above for more of Chandnani's takes on the trajectory of hotel demand.