NASHVILLE, Tennessee — The slow recovery of international inbound travel to U.S. markets has been a continued sore spot for hotels across the country, but hotel industry experts say a recovery is "imminent and expected to drive growth over the next five years."
Laura Baxter, director of hospitality analytics in Canada for CoStar Group, said drawing international travelers will grow more important going forward.
"Attracting this added demand is certainly a huge opportunity for hoteliers, but also a really important one based on the fact that more Americans are going abroad," she said during the "What the International Inbound Outbound Imbalance Means for Your Hotel" session at the 2024 Hotel Data Conference.
Daryl Cronk, senior economist for Tourism Economics, said just how much U.S. hoteliers will benefit from an influx of international travel depends on what markets they're in and what countries they draw from.
"When we talk about the importance of international travel, it's more than just the number," he said. "Really, it's the number relative to the size of the overall market."
Cities such as San Francisco, Miami and Honolulu are the most likely to see significant uplift from a new wave of international travelers.
The rebound in those markets, though, won't be uniform and will be based on how quickly their feeder markets fare. Miami, for example, sees demand flow in from Latin America, while San Francisco is more reliant on travelers from Asia-Pacific.
"So depending on where a city draws international visitors from, they may experience stronger or faster growth," Cronk said. "While Asia has been slow to recover so far, we are forecasting pretty strong growth over the next three to four years from Asia."
One thing regularly discussed as a big factor in inbound versus outbound international travel has been foreign currency exchange rates. The strength of the U.S. dollar has made destinations such as Europe and Japan appealing for American travelers but conversely made travel to the U.S. more expensive.
But Baxter said that's moderating, and feeder markets like South Korea and India have been able to overcome the effects of currency.
"So the overall takeaway here is that for the origins we examined, foreign exchange rate doesn't seem to be a significant deterrent or driver of overnight demand," she said.
She said something that's had a bigger effect is government bureaucracy, and visa wait times for travelers from countries such as India and Brazil force them to plan well in advance for travel.
Cronk acknowledged the U.S. presidential election will have some effect on international travel flows, but it's difficult to forecast that.
But "politics do matter" when it comes to international travel decisions, Baxter said. For example, Canada is still not on the list of approved destinations for Chinese outbound group travelers.
"Our group segment nationally is down considerably compared to the U.S.," she said. "It's down 4% [in the U.S.], whereas in Canada it's down but double digits. So politics definitely matter when it comes to travel."